Hexion begins $200 million Dutch auction tender offer for 8 3/8%, 9.2%, 7 7/8% debentures

By Angela McDaniels

Tacoma, Wash., May 11 - Hexion Specialty Chemicals, Inc. has begun a tender offer for its $77.51 million outstanding 8 3/8% debentures due 2016, $106.25 million outstanding 9.2% debentures due 2021 and $232.19 million outstanding 7 7/8% debentures due 2023, according to a company news release.

The total payment per $1,000 principal amount of notes will be set using a modified Dutch auction procedure and will fall between $180 and $280.

The total payment will be the lowest single bid price that will allow Hexion to pay $200 million in the offer or, in the event that the purchase of all notes would result in Hexion spending less than $200 million, the highest bid price.

Notes may be subject to proration.

The total payment includes a $30 early participation payment for notes tendered by 5 p.m. ET on May 22, the early participation date.

The company will also pay accrued interest up to but excluding the purchase date.

The tender offer will expire at midnight ET on June 8.

The offer is conditioned on the satisfaction of some customary conditions but is not conditioned on financing.

The dealer manager is Citi (800 558-3745 or 212 723-6106), and the information agent is Global Bondholder Services Corp. (212 430-3774 for banks and brokers only or 866 873-7700 for all others).

Hexion is based in Columbus, Ohio, and provides thermoset technologies and specialty products to the wood and industrial markets.

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