CPI to redeem $12 million floating-rate notes, $117 million 8% notes

By Melissa Kory

Cleveland, Feb. 9 - CPI International, Inc announced that it will purchase its outstanding $12 million of floating-rate senior notes due 2015 and its subsidiary Communications & Power Industries, Inc.'s $117 million of outstanding 8% senior subordinated notes due 2012 prior to their scheduled maturity dates.

The repurchases will be made in connection with CPI's pending merger with Catalyst Acquisition, Inc., an affiliate of Veritas Capital Fund IV, LP.

CPI began a tender offer for the floating-rate notes and 8% notes on Jan. 13. The offer will continue until midnight ET on Feb. 10.

Holders tendered all $12 million of floating-rate notes and 61.2% of the 8% notes by 5 p.m. ET on Jan. 27, the consent date.

As a result, CPI and its subsidiary said they received more than the consents needed to amend the notes.

The issuers will enter into a supplemental indenture to eliminate most of the restrictive covenants and some events of default and waive any and all defaults resulting from the proposed acquisition of CPI by Catalyst Acquisition.

The completion of the offer is subject to the completion of the proposed merger, the execution of the supplemental indentures containing the amendments and the receipt of enough financing to purchase the notes tendered in the offer or redeemed thereafter, pay for the delivered consents, repay all outstanding bank debt of Communications & Power and pay the consideration to the CPI stockholders in connection with the merger.

The dealer manager and consent solicitation agent is UBS Investment Bank (888 719-4210 or 203 719-4210). The information agent is D.F. King & Co., Inc. (800 488-8035 or, for banks and brokerage firms, 212 269-5550). Bank of New York Mellon Trust Co., NA is the tender agent and paying agent.

CPI is a Palo Alto, Calif.-based provider of microwave, radio frequency, power and control services for critical defense, communications, medical, scientific and other applications.

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