Corning accepts $226.35 million of tendered 5.9%, 6.2%, 8.875% notes

By Devika Patel

Knoxville, Tenn., Aug. 31 - Corning Inc. said holders had tendered $266,859,000 principal amount, or 56.18%, of three series of notes in its tender offer as of 11:59 p.m. ET on Aug. 30, the expiration date.

Of the notes, $266,399,000 were tendered by the early deadline of 5 p.m. ET on Aug. 16.

As previously reported, the company offered to purchase up to $225 million principal amount of its $200 million 5.9% notes due 2014, $200 million 6.2% notes due 2016 and $75 million 8.875% debentures due 2016.

The total amount tendered includes $112,935,000 principal amount, or 56.47%, of the 5.9% notes, $126,352,000 principal amount, or 63.18%, of the 6.2% notes and $27,572,000 principal amount, or 36.76%, of the 8.875% debentures.

Because the offer is oversubscribed, the company has increased the principal amount of notes that it will accept in the tender offer to $226,352,000.

Corning has accepted for purchase $100 million of 5.9% notes, $126,352,000 of 6.2% notes and none of the 8.875% debentures. The 5.9% notes have been prorated by a proration factor of approximately 88.61%, but the 6.2% notes have not been prorated.

For each $1,000 principal amount, the total purchase price is $1,141.50 for the 5.9% notes and $1,186.22 for the 6.2% notes and was going to be $1,317.44 for the 8.875% debentures.

The total purchase prices include an early tender premium of $50.00 per $1,000 principal amount of notes tendered by the early tender date.

The company will also pay accrued interest up to but excluding the settlement date, which is expected to be Sept. 1.

The total purchase prices were determined at 2 p.m. ET on Aug. 16 using a fixed spread over the yield based on the bid-side price of a specified U.S. Treasury security.

The reference Treasury was the 1.75% Treasury due March 31, 2014 for the 5.9% notes and the 2.375% Treasury due March 31, 2016 for the 6.2% notes and 8.875% debentures. The spread was 80 basis points for the 5.9% notes, 95 bps for the 6.2% notes and 105 bps for the 8.875% debentures.

The reference yield was 0.958% for the 5.9% notes and 1.621% for the 6.2% notes and 8.875% debentures.

The tender offer began Aug. 3.

The dealer managers were Deutsche Bank Securities Inc. (866 627-0391) and J.P. Morgan Securities Inc. (866 834-4666). The information agent was Global Bondholder Services Corp. (866 470-3700 or 212 430-3774).

Corning makes specialty glass and ceramics. It is based in Corning, N.Y.

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