Phibro Animal Health seeks 9 7/8% noteholder consents, plans to buy some notes

New York, Sept. 25 - Phibro Animal Health Corp. (Caa2) said that it has begun soliciting consents to proposed indenture changes from the holders of its 9 7/8% senior subordinated notes due 2008.

The solicitation will expire at 5 p.m. ET on Oct. 1, subject to possible extension.

The company said the purpose of the consent solicitation is to permit the company and its restricted subsidiaries to issue up to $105 million aggregate principal amount of new units and underlying senior secured notes; to permit other transactions described in the official consent solicitation statement; and to make a covenant of the existing notes' indenture conform in certain respects to the indenture for the new notes.

JPMorgan Chase Bank is the tabulation agent.

Phibro, a Fort Lee, N.J.-based diversified global manufacturer and marketer of animal health and nutrition products, specifically medicated feed additives and nutritional feed additives (formerly known as Philipp Brothers Chemicals, Inc.), simultaneously announced that it had begun a Rule 144A offering of up to $105 million of units, which are to consist of $85 million of senior secured notes due 2007 to be issued by the company and $20 million of senior secured notes due 2007 to be issued by Philipp Brothers Netherlands III BV, an indirect wholly-owned subsidiary of the Phibro Animal Health.

It plans to use a portion of the proceeds from the issue to fund its purchase of approximately $52 million aggregate principal amount of the existing 9 7/8% notes (out of the $100 million originally issued in June 1998), at a price of 60% of the principal amount, plus accrued and unpaid interest, in privately negotiated transactions.

It will use the rest of the proceeds to repay its existing domestic working capital credit facility; make a payment to Pfizer Inc. of $28.5 million, plus accrued interest on its existing promissory note due 2004 to repay: the $20.1 million principal amount of the promissory note; $12.8 million of accounts payable; $9.2 million of accrued expenses; and the company's future contingent obligations under the Pfizer agreements; and to pay related fees and expenses.

Phibro Health also intends to enter into a new domestic working capital facility providing for a working capital line of a $15 million plus a letter of credit facility and concurrently with the offering of its senior secured notes to sell its subsidiary The Prince Manufacturing Co.

It said that the receipt by the company of consents from holders of a majority in aggregate principal amount of the outstanding 9 7/8% notes - which are not subsequently revoked - is a condition to the completion of the offering of the units and underlying senior secured notes.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.