R.R. Donnelley says $198 million 8˝% notes issued in exchange so far

By Sarah Lizee

Olympia, Wash., April 3 – R.R. Donnelley & Sons Co. said it has started the exchange of $277 million of its outstanding notes for about $297 million of 8˝% senior notes due 2029.

The exchanges will take place in a series of closings expected to be completed by mid-April, according to an 8-K filing with the Securities and Exchange Commission.

As of 5:30 p.m. ET on April 2, the company had issued about $198 million of new notes under the indenture in exchange for about $185 million of exchange notes.

As previously reported, the company announced on March 16 that it had entered into privately negotiated agreements with the largest holder of its outstanding senior notes to effect a series of refinancing transactions that address a significant portion of the company’s 2023 and 2024 debt maturities.

The refinancing transactions include the repurchase of about $6.6 million of 7% senior notes due 2022 and $20 million of 6% senior notes due 2024 owned by the largest holder at 99 plus accrued interest. The company plans to fund the repurchases with a draw from its senior secured asset-based lending facility.

The refinancing transactions also include the exchange of about $277 million of the company’s outstanding debt owned by the largest holder, consisting of about $54 million of 6˝% senior notes due 2023, about $177 million of 2024 notes and about $46 million of 6 5/8% debentures due 2029 held by the largest holder for about $297 million of newly issued unsecured 8˝% senior notes due 2029.

Other than the interest rate, the terms of the exchange notes will be substantially similar to the terms of the 2029 debentures.

“The refinancing is an important step in our efforts to optimize the company’s capital structure and strengthen its balance sheet. These transactions provide us with greater flexibility as we continue to execute our strategic plans,” Terry Peterson, executive vice president and chief financial officer, said in the release.

R.R. Donnelley is a Chicago-based provider of integrated communication services.

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