Mueller Water solicits tenders, consents for 10%, 14¾% notes

By Laura Lutz

Des Moines, May 1 - Mueller Water Products, Inc. launched tender offers and consent solicitations for all of its outstanding 14¾% senior discount notes due 2014 and all of the outstanding 10% senior subordinated notes due 2012 of Mueller Group, LLC and Mueller Group Co-Issuer, Inc.

The offers are being conducted in connection with the refinancing of Mueller's existing credit facility and outstanding notes.

The company is soliciting consents to amend the note indentures to eliminate substantially all of the restrictive covenants and some events of default, amend some provisions relating to mergers and consolidations, and modify some terms of the defeasance and satisfaction and discharge provisions.

There are currently $204.75 million principal amount of the 10% notes and $144.95 million principal amount of the 14¾% notes outstanding.

The offers will expire at midnight ET on May 31, and the consent deadlines will be 5 p.m. ET on May 14.

For each $1,000 principal amount of 10% notes tendered, the payout will be based on the yield to maturity of the 4 7/8% U.S. Treasury due April 30, 2008 plus 50 basis points.

For each $1,000 principal amount of 14¾% notes, the payout will be based on the yield to maturity of the 4½% U.S. Treasury due March 31, 2009 plus 50 bps.

The total consideration will include a consent payment of $30 per $1,000 principal amount of notes. Notes tendered after the consent deadline will not receive the consent payment.

Holders will also receive accrued interest for the notes.

The company expects pricing to be determined at 2 p.m. ET on May 17.

Settlement of the offers depends on receipt of tenders and consents from holders of a majority of the notes and successful refinancing of the company's existing credit facility and outstanding notes.

Banc of America Securities LLC (888 292-0070 or collect 704 388-9217) and J.P. Morgan Securities Inc. (collect 212 270-3994) are the dealer managers and solicitation agents. Global Bondholder Services Corp. (866 924-2200 or banks and brokers 212 430-3774).

Atlanta-based Mueller manufactures infrastructure and flow-control products for water distribution networks and treatment facilities.

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