Alaris Medical tenders for three series of bonds

New York, May 23 - Alaris Medical Inc. (senior secured at B1/BB-; subordinated at B3/B-) said that along with its wholly-owned operating subsidiary, Alaris Medical Systems Inc., it has begun cash tender offers for any and all of the company's three series of currently outstanding bonds,

Alaris Medical Inc. is tendering for its outstanding 11 1/8% senior discount notes due 2008; Alaris Medical Systems is meanwhile tendering for its outstanding 11 5/8% senior secured notes due 2006 and 9¾% senior subordinated notes due 2006.

Alaris, a San Diego-based provider of intravenous medication delivery and infusion therapy devices, needle-free disposables and related monitoring equipment and software to hospitals and other health care facilities, is also soliciting noteholder consents to proposed amendments in the three series of notes' indentures. The amendments would eliminate or modify substantially all of the restrictive covenants, most of the event of default provisions, many of the remedial provisions and other provisions contained in the indentures of the respective notes, and in the case of the 11 5/8% secured notes, in the security documents relating to such notes as well).

Holders may not tender their notes without also delivering consents. The tender offers are conditioned upon, among other things, a majority of the bonds having been tendered and related consents delivered.

The consent solicitations are scheduled to expire at 5 p.m. ET on June 5, while the tender offers are to expire at 5 p.m., New York City time, on June 20, with both deadlines subject to possible extension past the original dates.

Holders of the 11 1/8% senior discount notes who validly tender their notes and deliver consents by the consent date will receive the total consideration of $1,053.75 per $1,000 principal amount at maturity of senior discount notes, which includes a consent payment of $20 per $1,000 principal amount.

Holders of the 11 5/8% senior secured notes who validly tender their notes and deliver consents by the consent date will receive the total consideration of $1,210 per $1,000 principal amount of senior secured notes, which includes a $20 per $1,000 principal amount consent payment. They would also receive accrued and unpaid interest from the last interest payment date up to (but not including) the payment date.

Holders of the 9¾% senior subordinated notes who validly tender their notes and deliver consents by the consent date will receive the total consideration of $1,037.50 per $1,000 principal amount , which includes the $20 per $1,000 principal amount consent payment. They would also receive accrued and unpaid interest up to the payment date.

Holders tender their notes after the consent deadline but before the expiration date of the applicable tender will not be entitled to the applicable consent payment, and will only receive the total consideration minus the consent payment, plus interest, where applicable.

Alaris said the tender offers and consent solicitations are being made in connection with a proposed recapitalization of parent Alaris Medical Inc. and subsidiary Alaris Medical Systems. This recapitalization would take advantage of the company's improved operating results and the current interest rate environment, and would involve the several concurrent transactions:

Alaris Medical Inc. would make a public offering of approximately $210 million of new senior subordinated notes and establish a new secured credit facility with a group of banks and other lenders providing for up to $235 million in aggregate principal amount of term loans and an approximately $30 million revolving credit facility.

It would also make a public offering of 9.1 million shares of the company's common stock, plus up to a 15% over allotment option exercisable by the underwriters comprising 900,000 shares to be sold by the company and 450,000 shares to be sold by shareholders, as detailed in the company's S-3 registration with the Securities and Exchange Commission.

As part of the recapitalization, Alaris Medical Inc. and Alaris Medical Systems would merge, with the resulting surviving company to be named "Alaris Medical Systems Inc." Its shares would continue to trade on the American Stock Exchange under the current symbol "AMI."

Alaris said that a portion of the net proceeds of these transactions would be used to fund the tender offers, consent solicitations and related fees and expenses. Proceeds would also be used to reduce the company's debt level and annual interest expense, and for general corporate purposes.

The company said that if these transactions are successfully executed, it estimates that it will record a one-time after-tax charge of approximately $37 million. Annual interest expense is expected to be reduced by approximately $26 million on a pre-tax basis.

Alaris' obligations to accept notes for purchase and to pay for them is subject to the conditions stated in the tender offers, including the condition that holders of a majority in aggregate principal amount of each series of notes shall have tendered their notes and consented to the amendments to the indentures (and, in the case of the 11-5/8% senior secured notes, to the applicable security documents).

Completion of the offer is also conditioned upon Alaris having received sufficient proceeds from equity and debt financings to complete the offers and certain related transactions, on terms acceptable to the company.

Alaris Medical Inc. and Alaris Medical Systems expect to make payment on notes validly tendered and accepted for purchase promptly after the expiration dates of the applicable offers. Holders who validly tender their notes will also be paid accrued and unpaid interest up to, but not including, the date of payment for the notes.

Bear, Stearns & Co. Inc. (call toll-free at 877 696-2327) and Citigroup Global Markets Inc. (call toll-free at 800 558-3745) will act as the exclusive dealer managers and solicitation agents for the tender offers and consent solicitations. Mellon Investor Services LLC (call 917 320-6286, or toll-free at 866 323-8166) will be the information agent.

Texas Gas Transmission sets consideration for 8 5/8% '04 notes tender

New York, May 23 - Texas Gas Transmission, LLC said that it had set the consideration to be paid in its previously announced tender offer for any and all of its $150 million in aggregate principal amount of outstanding 8 5/8% notes due 2004.

It will pay total consideration of $1,058.44 per $1,000 principal amount of notes tendered and accepted for purchase, which includes an early tender premium of $30 per $1,000 principal amount. That premium will be payable only to those holders who tendered their notes by the early tender deadline, which expired as scheduled at 5 p.m. ET on May 22 without extension.

Additionally, holders of notes which were validly tendered by the early tender deadline and not withdrawn will receive $13.66 of accrued and unpaid interest up to an assumed settlement date of May 28.

The company said that $132.715 million in aggregate principal amount of the notes, or 88.5% of the total amount outstanding, were tendered and not withdrawn by the early tender deadline.

Holders of the remaining notes who validly tender them prior to the previously announced expiration deadline of 12 midnight ET on June 13 and who do not withdraw them will receive the total consideration amount less the early tender premium, or $1,028.44 per $1,000 principal amount of notes, and will also receive accrued and unpaid interest up to and not including the final settlement date, which is expected to be promptly following the expiration of the offer.

As previously announced, Texas Gas Transmission, an Owensboro, Ky.-based energy transmission company - formerly known as Texas Gas Transmission Corp. - said on May 16 that it had begun a tender offer for any and all of the 8 5/8% notes.

It set an early tender deadline of 5 p.m. ET on May 22, and set the expiration for 12 midnight ET on June 13, subject to possible extension.

The company said that it would determine the total compensation to be paid to tendering noteholders based on a 50-basis point fixed spread over bid- side yield of the reference security - the U.S. Treasury 3.625% note due March 31, 2004 - as of 2 p.m. ET on the early tender date, and said the total consideration would include the $30 per $1,000 principal amount early tender premium. Tendering holders would also receive accrued and unpaid interest up to, but not including, the applicable settlement date.

Texas Gas Transmission said it plans to fund the tender offer with the net proceeds from financings by Texas Gas and its parent, TGT Pipeline, LLC - including one or more offerings of new notes - as well as cash on hand.

The company said that its obligation to accept for purchase and to pay for any existing notes validly tendered in the tender offer would be conditioned on, among other things, the consummation by Texas Gas Transmission and TGT Pipeline of new notes on terms and conditions satisfactory to the company and TGT Pipeline, by 12 midnight ET on the expiration date of the offerings, as well as receipt by the company of net proceeds from the offerings that would be sufficient, along with the cash on hand, to repay certain interim indebtedness and purchase all outstanding notes.

It cautioned that the securities to be offered as part of the financing for the tender offer have not been, and will not be, registered under the Securities Act of 1933 and may not be offered or sold in the U.S., absent registration or an applicable exemption from such registration requirements.

Lehman Brothers Inc. (call Rad Antonov of the Liability Management Group toll-free at 800 438-3242 or collect at 212 528-7581) and Citigroup Global Markets Inc. (call the Liability Management Group toll-free at 800 558-3745, or call 212 723-6106), will serve as dealer managers for the tender offer. Innisfree M&A Inc. will serve as the information agent (call toll-free at 888 750-5834, or collect at 212 750-5833).

American Seafoods Group to plans to redeem some 10 1/8% '10 notes, tender for remainder

New York, May 23 - American Seafoods Corp. said that it plans to redeem 35% of its outstanding 10 1/8% senior subordinated notes due 2010 using the proceeds of a planned offering of income deposit securities, and then plans to tender for the remaining outstanding notes.

The Seattle, Wash.-based producer of seafood products outlined its intentions in an S-1 filing with the Securities and Exchange Commission on May 22.

It said that in conjunction with the IDS offering, its American Seafoods Group LLC (B3) subsidiary, which issued $175 million of the 10 1/8% notes in April 2002, intends to begin a consent solicitation among the holders of the outstanding notes; the closing of the consent solicitation is a condition to the IDS offering.

The filing said that American Seafoods Group also intends to redeem 35% of the 10 1/8% notes under terms of the optional redemption clause in the notes' indenture, and to commence a tender offer for the remaining existing notes. American Seafoods Group will use a portion of the as yet unspecified net proceeds from the IDS offering and borrowings under a planned $300 million new credit facility to pay for the repurchase of the 10 1/8% notes pursuant to the redemption and tender offer and the fees, expenses and premiums associated with the consent solicitation, redemption and tender offer.

The filing did not lay out a timetable for the proposed income deposit securities offering or for the anticipated 35% redemption of the 10 1/8% notes and related consent solicitation and tender offer.

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