Portola Packaging to repay about $40 million of bank debt with bond sale proceeds

By Sara Rosenberg

New York, Dec. 9 - Portola Packaging Inc. plans to repay about $40 million of outstanding bank debt with a portion of the proceeds from a proposed $180 million senior notes offering, according to a company news release.

Furthermore, the company intends to amend and restate its credit agreement in connection with the offering, the release added.

The company also plans to use the bond sale proceeds to redeem the entire $110 million aggregate principal amount of the company's 10.75% senior notes due 2005. About $20 million of the net proceeds will be used to redeem outstanding redeemable warrants and to repurchase outstanding shares of its common stock. Any remaining proceeds will be used for general corporate purposes.

Portola Packaging is a San Jose, Calif., maker of plastic containers and closures for the food and beverage industries.

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