B/E Aerospace Announces Payment for 8 1/2% Senior Notes Due 2010 Tendered Prior to Consent Date and Its Entry into a New Senior
July 26 2006 - 6:47PM
Business Wire
B/E Aerospace, Inc. (the "Company") (Nasdaq:BEAV) today announced
that, in connection with its cash tender offer and consent
solicitation for its outstanding $175.0 million aggregate principal
amount of its 8 1/2% Senior Notes due 2010 (the "Notes"), it has
accepted for payment and paid for $174.94 million aggregate
principal amount of the Notes, which were tendered by holders on or
prior to the expiration of the related consent solicitation at 5:00
p.m. New York City time on July 21, 2006 (the "Consent Date"),
representing 99.97% of the outstanding Notes. The tender offer is
scheduled to expire at 5:00 p.m. New York City time on August 7,
2006, unless extended or earlier terminated. In connection with
this tender offer and consent solicitation, the Company entered
into a new senior secured credit facility, consisting of a
five-year, $150 million revolving credit facility and a six-year,
$75 million term loan with J.P. Morgan Securities Inc., UBS
Securities LLC and Credit Suisse Securities (USA) LLC, as Joint
Lead Arrangers and Joint Bookrunners, and JPMorgan Chase Bank,
N.A., as Administrative Agent. The new senior secured credit
facility also provides for the ability of the Company to add
additional term loans in the amount of up to $75.0 million upon
satisfaction of certain customary conditions. The new senior
secured credit facility replaces the Company's existing $50 million
revolving credit facility that it had entered into in February 2004
and would have matured in 2007. Revolving credit borrowings under
the new senior secured credit facility will initially bear interest
at an annual rate equal to the London interbank offered rate
(LIBOR) plus 175 basis points, representing an initial interest
rate of 7.2% as compared to 8-1/2% under the Notes repurchased
today. Term loan borrowings under the new senior secured credit
facility will initially bear interest at an annual rate equal to
the London interbank offered rate (LIBOR) plus 200 basis points,
representing an initial interest rate of 7.4%. After entering into
this new senior secured credit facility and paying for both the
Notes tendered in the tender offer and after giving effect to the
consummation of the Company's recently announced acquisition of
Draeger Aerospace GmbH for $80 million in cash, as of June 30,
2006, the Company would have had $447 million of long-term debt
outstanding and $80 million of cash and available borrowings under
the revolving credit facility, after taking into account $6 million
of outstanding letters of credit. After giving effect to the
refinancing, including the purchase of the tendered Notes, and the
acquisition of Draeger, as of June 30, 2006, the Company's net
debt-to-capital ratio would have been 38%, as compared with the
Company's June 30, 2006 actual net debt-to-capital ratio of 32%.
Net debt represents total debt less cash and cash equivalents. The
Company plans to raise a new term loan, the proceeds of which would
be used to repay all outstanding amounts borrowed under the
revolving credit facility announced today, and to negotiate a new
revolving credit facility at that time. Amin J. Khoury, Chairman
and Chief Executive Officer of B/E Aerospace, Inc. said, "This
refinancing is another element of B/E Aerospace's ongoing
commitment to lower our cost of capital and to maintain our net
debt to capital ratios, while pursuing opportunities to grow our
business." The Company has retained UBS Securities LLC, Credit
Suisse Securities (USA) LLC and J.P. Morgan Securities Inc. to
serve as Dealer Managers, and Global Bondholder Services
Corporation to serve as Depositary and Information Agent. Persons
with questions regarding the tender offer and consent solicitation
should contact UBS Securities LLC toll free at 888-722-9555 ext.
4210 and collect at 203-719-4210, Credit Suisse Securities (USA)
LLC toll free at 800-820-1653 and collect at 212-325-7596, and J.P.
Morgan Securities Inc. collect at 212-270-7407, or Global
Bondholder Services Corporation at 866-804-2200. Requests for
documentation should be directed to Global Bondholder Services
Corporation at 866-804-2200. This announcement is for information
purposes only and constitutes neither an offer to purchase nor a
solicitation of an offer to sell the Notes. The tender offer and
consent solicitation is being made only pursuant to the Offer to
Purchase and Consent Solicitation dated July 10, 2006 and related
materials. About B/E Aerospace, Inc. B/E Aerospace, Inc. is the
world's leading manufacturer of aircraft cabin interior products,
and a leading aftermarket distributor of aerospace fasteners. B/E
designs, develops and manufactures a broad range of products for
both commercial aircraft and business jets. B/E manufactured
products include aircraft cabin seating, lighting, oxygen, and food
and beverage preparation and storage equipment. The company also
provides cabin interior design, reconfiguration and
passenger-to-freighter conversion services. Products for the
existing aircraft fleet - the aftermarket - generate about 60
percent of sales. B/E sells and supports its products through its
own global direct sales and product support organization. For more
information, visit B/E's website at http://www.beaerospace.com.
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