Momentive: $515 million of notes tendered in exchange offers so far

By Angela McDaniels

Tacoma, Wash., May 27 - Momentive Performance Materials Inc. had received tenders for $515 million principal amount of notes in its private exchange offers as of 5 p.m. ET on May 26, according to a company news release.

Notes eligible for exchange are the company's $765 million outstanding principal amount of 9¾% senior notes due 2014, $316.31 million outstanding principal amount of 10 1/8% - 10 7/8% in kind - senior toggle notes due 2014, $500 million outstanding principal amount of 11½% senior subordinated notes due 2016 and €275 million outstanding principal amount of 9% senior notes due 2014.

Of the $515 million notes tendered so far, $347 million are senior notes and $168 million are subordinated notes.

The company is offering to issue up to $200 million principal amount of new 12½% second-lien senior secured notes due 2014 in exchange for tendered notes. No more than $50 million of new notes will be issued in exchange for 11½% notes.

The amount of new notes to be issued for each $1,000 principal amount of old notes will be determined using a modified Dutch auction procedure.

Holders who tendered by 5 p.m. ET on May 26, the early tender date, will receive an early delivery payment, which will be made in the form of new notes.

The exchange offers began May 12 and will expire at 5 p.m. ET on June 9.

The new notes will be guaranteed on a senior secured basis by each of Momentive's U.S. subsidiaries that is a guarantor under the company's senior secured credit facilities and secured by a second-priority security interest in some assets of Momentive and the guarantors.

The exchange offers are being made only in the United States to noteholders who are both qualified institutional buyers and U.S. persons and outside the United States to persons other than U.S. persons who are non-U.S. qualified offerees.

Apollo Management, LP, the controlling shareholder of Momentive, owns roughly $47 million principal amount of the 11½% notes and $167 million total principal amount of the other three series of notes.

The dealer manager is J.P. Morgan Securities Inc. The information agent is Global Bondholder Services Corp. (866 794-2200 or 212 430-3774).

Momentive is an Albany, N.Y.-based provider of high-technology materials services to the silicones, quartz and ceramics markets.

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