Tower exchanges bonds in more debt restructuring

The move extends the maturity date on about $80 million of the firm's debt.

Semiconductor producer Tower Semiconductor Ltd. (Nasdaq: TSEM; TASE: TSEM) continues a move to restructure its debt load. Tower bought Jazz in 2008 and does business as TowerJazz.

The firm will exchange approximately $80 million of its outstanding $123 million of Jazz Technologies 8% convertible senior bonds due 2011 for new non-convertible senior bonds due 2015.

The new non-convertible bonds will rank equally with the outstanding bonds and will have an 8% annual coupon. The exchanging bondholders will also receive warrants for the purchase of approximately 25 million Tower ordinary shares at an exercise price of $1.70 per share.

Tower CFO Oren Shirazi said, “Our restructuring plan is well underway with this agreement, the Wells Fargo credit line extension and the agreement with our Israeli banks which were signed and announced in June. These agreements are instrumental in enabling TowerJazz to execute its strategic growth plan and further improve our balance sheet and financial condition."

Tower CEO Russell Ellwanger added, "Once completed, our debt restructuring plan will reduce and reschedule our debt, enabling a new and exciting corporate investment perspective."

Tower shares closed at $1.38 on Friday, up 1.47%.

Published by Globes [online], Israel business news - - on July 11, 2010

© Copyright of Globes Publisher Itonut (1983) Ltd. 2010

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