Open Solutions Inc. has announced plans to retire most of its outstanding debt in conjunction with the private-equity deal it unveiled in October.
The Glastonbury, Conn., vendor, the fifth-largest provider of core processing software and services, said Thursday that it had started a cash tender offer for its senior subordinated convertible notes due in 2035. The offer is conditional on completing its acquisition by a pair of private equity funds, Carlyle Group and Providence Equity Partners Inc. The deal is expected to close in the first quarter.
The offer covers debt with a $270 million value at maturity. Open Solutions said the accreted value as of Wednesday was $144.1 million. The company sold the notes in June at $533.36 per $1,000 of value at maturity and is offering $781.02. Though the debt may be traded over the counter, Open Solutions said it believed any activity was "limited and sporadic."
The tender offer is to expire Jan. 22, unless extended or terminated. The next cash interest payment is due Feb. 2 to note holders of record on Jan. 15, and Open Solutions said holders would be entitled to that payment.
The Wachovia Securities unit of Wachovia Corp. is the dealer manager for the offer. D.F. King & Co. Inc. is the information agent and tender agent.
