American completes refinancing, Coastal buyout

This just in from American Seafoods:

May 10, 2010

American Seafoods Completes Refinancing and Buyout of Significant Equity Holder

SEATTLE (BUSINESS WIRE) — American Seafoods today announced it completed a refinancing of all the outstanding debt of American Seafoods Group LLC and ASG Consolidated LLC, the direct parent of American Seafoods Group. Concurrent with the refinancing, the Company redeemed the entire ownership interest of a significant equity holder, Coastal Villages Region Fund.

The company refinanced ASG Consolidated's high yield bonds and American Seafoods Group's senior credit facility, significantly extending the maturities on its debt.

"The refinancing represents a significant accomplishment for the company," said Bernt O. Bodal, CEO of American Seafoods. "The fact that we were able to complete a transaction like this in a difficult economic environment is a testament to the strong support of our lending partners and the stellar reputation the company enjoys among the financial community."

Also, in connection with the refinancing, American Seafoods redeemed all of the outstanding equity interests of Coastal Villages in exchange for the pollock catcher-processor Northern Hawk, the freezer-longline vessels Lilli Ann, North Cape and Deep Pacific and certain fishing rights. The completion of the buyout results in Bodal and the rest of the management team increasing their ownership to over 70 percent of the company. As part of the buyout, American will provide management and marketing services to Coastal Villages — enhancing its revenue opportunities over the next few years.

"The buyout offers a terrific opportunity for all of the continuing owners of American Seafoods to increase their ownership stake and positions us well for the long-term growth of the company," Bodal said.

Something big brewing with American Seafoods?

Deckboss advised you a couple of weeks ago about a possible divorce involving American Seafoods and one of its main owners, Coastal Villages Region Fund.

Now, apparently, Seattle-based American, operator of the largest fleet of Bering Sea pollock factory trawlers, is mounting a major refinancing.

A friend today passed along the following item from some sort of subscriber-based financial news service.

It would take, like, a Goldman Sachs trader to fully understand this thing, but it seems clear this is a big and possibly transformative deal for American.

American Seafoods preps bond deal for refinancing effort

American Seafoods this morning unveiled a $400 million, two-part bond deal that is part of a broader refinancing effort. The deal includes $275 million of six-year (non-call three) subordinated notes issued by American Seafoods Group and $125 million of senior notes with warrants from ASG Consolidated and ASG Finance, according to sources.

Bank of America and Wells Fargo are joint bookrunners on the deal. The notes are being issued under Rule 144A for life.

The units consist of seven-year (non-call three) senior notes and warrants expiring in 2018 to purchase 125,000 common shares representing about a 15% indirect ownership of ASG Consolidated, according to sources. The senior notes are conditionally PIK and the first two interest payments will be paid in kind. The first call on notes is at par plus 75% of the coupon.

The subordinated notes are rated B/B3, with a stable outlook on both sides. S&P also gave these notes a 4 recovery rating, which indicates expectations for average (30-50%) recovery in the event of a payment default. The PIK notes are not rated.

Proceeds from the deal will be used to repay debt. The bond deal accompanies a loan package that includes a $85 million, five-year revolving credit, priced at L+400, and a $390 million, five-year term loan, priced at L+400 with a 1.5% LIBOR floor, offered at 99. Bank of America Merrill Lynch, Wells Fargo and DNB Nordbanken are arranging the loan.