EVENFLO MAKES ANNOUNCEMENT
VANDALIA, OHIO, November 19, 2002
-- Evenflo Company, Inc. today announced it
has reached agreement with its lenders, certain
noteholders and its controlling shareholder
(an affiliate of the investment firm of Kohlberg
Kravis Roberts & Co., L.P.) for a recapitalization
of the Company.
As part of the recapitalization, the Company
will offer the holders of its $110 million 11¾%
Series B Senior Notes due 2006 the right to
exchange their Senior Notes for equity in the
recapitalized Company or $150 cash per $1,000
principal amount of Senior Notes. An additional
approximately $15 million of bank indebtedness
will be extinguished in the recapitalization.
The Company also expects to receive from its
controlling shareholder new cash equity of approximately
$18 million, plus the amount needed to pay noteholders
electing to receive cash in connection with
the recapitalization, with this cash being applied
to purchase new common equity in the Company.
If successful, the recapitalization will reduce
the Company’s leverage from $215 million
to $72 million. The recapitalization will have
no effect on trade creditors or customers.
“I am pleased to announce that we have
reached agreement on the form of a recapitalization
for the Company. We are eager to implement the
recapitalization as soon as possible. The additional
equity infusion and debt reduction will further
expand our ability to develop new products and
build on our recent progress in our marketplace,”
said Wayne Robinson, Chief Executive Officer
of Evenflo.
Noteholders holding more than 70% in aggregate
principal amount of the outstanding Senior Notes,
Evenflo’s controlling shareholder, the
Company’s lenders and the Company all
have agreed, subject to certain conditions,
to support the recapitalization. The Company
has agreed to commence a tender and exchange
offer reflecting such exchange as soon as practicable.
If all noteholders elect to receive equity in
the exchange offer, noteholders in the aggregate
would be entitled to receive approximately 40%
of the Company’s common equity after the
recapitalization. The tender and exchange offer
will be conditioned on several items, including
100% participation by the noteholders.
The Company expects to complete the recapitalization,
which is subject to documentation and other
customary conditions, by the end of the year.
***
Evenflo Company, Inc. is a worldwide
leader in the development and manufacture of
innovative and high quality infant and juvenile
products.
This press release contains
statements which are forward-looking statements
within the meaning of applicable federal securities
laws and are based upon the Company's current
expectations and assumptions which are subject
to a number of risks and uncertainties which
could cause actual results to materially differ
from those anticipated.
Contacts:
707 Crossroads Court
Vandalia, Ohio 45377
(937) 415-3300
Media Contact:
Daryle Lovett,
Chief Financial Officer
(937) 415-3205
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