Texas Municipal Gas II continues to consider exchange offer for series 2007 gas supply revenue bonds

By Angela McDaniels

Tacoma, Wash., Nov. 5 - Texas Municipal Gas Acquisition and Supply Corp. II said it continues to evaluate a possible financial restructuring of its $516.175 million series 2007A and $1.418 billion series 2007B gas supply revenue bonds.

As previously reported, the company may offer to issue fixed-rate bonds in exchange for the series 2007 bonds. Texas Municipal Gas II expects to decide whether to hold the offer within the next 90 days, according to a company news release.

The new bonds issued in the exchange offer would be secured under the same trust indenture with the same lien priority. Texas Municipal Gas II said the exchange, if pursued, would be intended to remediate the impact of the current bond market on bondholders.

The exchange offer would be accompanied by a consent solicitation to authorize an amendment to the trust indenture that is needed in order to allow the exchange. The company would need consents from holders of a majority of the bonds.

Texas Municipal Gas II first announced the possible exchange offer in mid-May and said it planned to make a decision within 60 days.

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