Kraton Performance units obtain needed consents for 8 1/8% notes

By Jennifer Chiou

New York, Feb. 11 - Kraton Performance Polymers, Inc. subsidiaries Kraton Polymers LLC and Kraton Polymers Capital Corp. announced the receipt of tenders and consents from holders of $151,025,000, or 92.65%, of their $163 million of 8 1/8% senior subordinated notes due 2014.

After receiving the requisite consents as of 5 p.m. ET on Feb. 10, the companies said that they have executed a supplemental indenture.

The companies are seeking to amend the indenture governing the notes to eliminate substantially all of the restrictive covenants, some events of default and related provisions. Holders may not tender their notes without delivering their consents or vice versa.

The companies will pay $1,017 per $1,000 principal amount of notes. This amount includes a consent payment of $17 for each note tendered by the consent deadline.

Holders will also receive accrued interest up to but excluding the payment date.

The tender offer and consent solicitation will expire at 8 a.m. ET on Feb. 28. The launch date was Jan. 28.

As previously reported, concurrently with the tender offer, Kraton expects to pursue a refinancing transaction, which may consist of a senior secured credit facility, an issuance of notes or a combination of both.

The completion of the tender offer is conditioned on the successful completion of a refinancing transaction and the execution of a supplemental indenture reflecting the proposed amendments to the indenture.

Once a refinancing transaction is completed, the company plans to redeem any notes that are not purchased in the tender offer.

Bank of America Merrill Lynch (888 292-0070 or 980 388-9217) is the dealer manager, and D.F. King & Co., Inc. (800 967-7635 or 212 269-5550) is the information agent.

Kraton makes engineered polymers and is based in Houston.

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