Rafaella PursuesTender Offer
February 23, 2010
Rafaella Apparel Group kicked off a tender offer Monday and hopes to close a credit agreement amendment to help finance it, the company said.
The New York-based clothing designer and wholesaler said it plans to buy back the bonds using a modified Dutch auction. It will purchase between $18 million and $36.4 million of its 11.25% senior secured notes due 2011, but will not spend more than $19.1 million to do so. Rafaella will buy the notes for between $525 million and $600 million per $1,000 in principal amount. The offer expired March 19.
The company plans to use cash on hand and an amended and restated credit agreement with HSBC, which will include $10 million in a senior secured term financing, to fun the offer. The closing of the restated credit agreement is pursuant to the closing of the tender offer.
Rafaella has a total of $71.9 million in 11.25% notes outstanding, the company said.
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