Tuesday, August 24, 2010

Alcoa (NYSE:AA) Misses Maximum on Debt Repurchase Amount

Alcoa Inc. (AA) released the final results of the second phase of its buyback of notes, which was targeted at up to $750 million, which were scheduled to mature over the next three years. It is part of their strategy to lower debt through refinancing.

Data released today shows 38% of the $516.7 million of 6% 2012 notes and 33% of its $197.2 million of 5 3/8% 2013 notes had been tendered. Holders will receive a premium of close to 6.3% of face value, including a premium for early tender. Alcoa had extended the early tender date in the first part of August; when the tendered amounts were 37% and 31%.

In the first phase of the tender offer, Alcoa offered to acquire $583.5 million of 6.5% notes due in 2011. What was left after that of the $750 million would be applied to acquiring 2012 and 2013 notes. In early August Alcoa said about 43 percent of the 2011 notes had been tendered.

Of the notes targeted by Alcoa, they'll acquire $645.4 million of them.

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