CAP Plans Bond Buyback

Chilean steelmaker Cap plans to buy back any and all of its $200m of outstanding 7.375% 2036 bonds, The purchase price will be equal to the present value of $1,000 in principal, using the July 19 reference yield on the 4 3/8% UST due May 15 2041 plus a fixed spread of 220bp. CAP expects settlement to take place on July 22. The offer expires at 5:00pm New York City time on July 19. Citi is acting as dealer manager. On Friday the bonds were trading at a wide bid-offer of 105.5-107.00, according to a trader. The 2036s were originally sold in 2006 through Citi and HSBC and priced at 99.761 to yield 7.395% or 250bp over. The BBB minus rated CAP recently extended a 3-year loan into a 5-year facility, upsizing to $200m from an original $150m.