Fresenius sets pricing in tender for Renal Care's 9% notes

By Jennifer Chiou

New York, Jan. 13 - Fresenius Medical Care AG subsidiary Florence Acquisition, Inc. announced it set pricing in its tender offer for Renal Care Group, Inc.'s $159.685 million of 9% senior subordinated notes due 2011.

For each $1,000 principal amount of notes, the company said it will pay $1,109.28 based on an assumed payment date of Jan. 31. The payout, which includes a $30.00 consent payment for those who tendered their holdings before the consent deadline, was based on the present value of the notes, assuming they are redeemed at $1,045 on their first call date of Nov. 11, 2007, discounted using the 4¼% Treasury due Oct. 31, 2007 and 50 basis points.

The reference yield was 4.394%.

Pricing was calculated at 10 a.m. ET on Jan. 13.

On Dec. 23, the company extended the tender deadline to 5 p.m. ET on Jan. 30 from 5 p.m. ET on Dec. 29.

If the expiration date is further extended for more than 10 business days, the company noted new pricing terms for the reference security will be determined.

At 5 p.m. ET on Dec. 22, the company said it had received tenders from holders of 99.87% of the notes.

On Dec. 14, the company announced pricing based on a Dec. 30 payment date. At that time, the company said holders who tendered by the consent deadline of 5 p.m. ET on Dec. 13 would receive $1,112.16 per $1,000 principal amount, including the consent payment.

Fresenius already announced it had received enough consents to amend Renal Care's notes. By the consent deadline, holders had tendered $159.485 million or 99.9% of the securities.

Renal Care plans to execute a supplemental indenture including the changes, which will become effective when Florence buys the notes.

The tender was announced on Dec. 1 as part of the pending acquisition of Renal Care and its subsidiaries by Fresenius Medical Care.

The consent solicitation is to amend the notes' indenture to eliminate all restrictive covenants and other provisions.

The offer is conditioned upon, among other things, the receipt of consents from a majority of noteholders and satisfaction of the merger conditions. However, the tender is not a condition of the merger.

Credit Suisse First Boston LLC is dealer manager and solicitation agent. The information agent is Morrow & Co., Inc.

Bad Homburg, Germany-based Fresenius provides dialysis products and services. Renal Care is a Nashville, Tenn.-based dialysis service provider.

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