MF Global plans cash inducement premium in offer for 9% senior notes, convertible preferreds

By Devika Patel

Knoxville, Tenn., June 15 - MF Global Holdings Ltd. said it has fixed the premium it will pay to tendering holders in exchange for its $205 million of 9% convertible senior notes due 2038 and $150 million of 9.75% non-cumulative convertible preferred stock, series B.

The exchange offer launched on June 1 and will expire at 11:59 p.m. ET on June 29.

For each $1,000 principal amount of notes, MF Global will pay 95.6938 shares of its common stock plus a premium of $445.

For each preferred, the company will pay 9.5694 shares of common stock plus a premium of $41.

The premiums will be paid in cash.

Holders will also receive accrued interest or dividends in cash, as applicable, up to but excluding the settlement date.

MF Global is also soliciting consents from holders of the 9% convertibles to the termination of a replacement capital covenant made for their benefit in connection with the issuance of the company's series A preferred stock in 2008. Holders who tender will be deemed to have consented to the termination.

Consents are needed from holders of a majority of the principal amount outstanding of the notes in order to terminate the covenant.

U.S. Bank NA is the exchange agent, and the information agent is Georgeson, Inc. (212 440-9800 for banks and brokers, others call 866 828-4304).

MF Global is a cash and derivatives brokerage firm based in New York.

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