HOUSTON, Jan. 9 /PRNewswire-FirstCall/ -- Westlake Chemical Corporation (NYSE: WLK) announced today that it has commenced a plan to refinance its debt. The plan includes: the retirement of the company's 8 3/4% Senior Notes due 2011, of which $247 million in principal amount are outstanding; the issuance of new senior notes due 2016 in the principal amount of $250 million; the repayment of the company's term loan of approximately $9 million; and an amendment to the company's revolving credit facility to increase the commitment from $200 million to $300 million.
Albert Chao, Westlake Chemical's Chief Executive Officer and President, stated, "This is a positive step for Westlake. Interest rates remain low by historical standards and as a result of these actions, we expect to reduce our interest expense going forward, as well as gain more flexible and favorable conditions for implementing our growth strategy in the future."
The company concluded the amendment to the revolving credit facility on January 6. Today, the company will issue a redemption notice for $180 million principal amount of the 8 3/4% Senior Notes due 2011, to be redeemed on February 8 at a redemption price of 100% plus accrued but unpaid interest, plus a make-whole premium as provided in the indenture governing these notes, and expects to call for redemption the remaining $67 million principal amount of these notes after completion of the issuance of the new senior notes. The further execution of the refinancing plan, including the call of the remainder of the existing senior notes and the issuance of new senior notes, is contingent on, among other things, satisfactory market conditions and no material adverse change in the company's business or operations.
The company expects the plan to be completed before the end of February 2006 and to result in lower interest expense and more beneficial terms from that point on. Upon successful completion of the plan, Westlake will recognize an after-tax charge of approximately $18 million in the first quarter of 2006 arising from the payment of a make-whole premium and the write-off of previously capitalized debt-issuance costs.
The new senior notes will be issued pursuant to a shelf registration statement filed with the Securities and Exchange Commission on May 23, 2005, and declared effective on December 19, 2005. This release shall not constitute an offer to sell or the solicitation of an offer to buy any securities nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state. Any offer of these securities will be made solely by means of the prospectus included in the registration statement and a prospectus supplement in respect of any such offering.
The statements in this release relating to the completion of the refinancing plan and the results of the plan, as well as any other matters that are not historical facts, are forward-looking statements that are subject to risks and uncertainties. Actual results could differ materially, based on factors including, but not limited to, changes in the financial markets and the company's results of operations. For more detailed information about the factors that could cause actual results to differ materially, please refer to
Westlake's Annual Report on Form 10-K for the year ended December 31, 2004, which was filed in March 2005.
Westlake Chemical Corporation is a manufacturer and supplier of petrochemicals, polymers and fabricated products with headquarters in Houston, Texas. The company's range of products includes: ethylene, polyethylene, styrene, propylene, caustic, VCM, PVC and PVC pipe, windows and fence. For more information, visit the company's Web site at http://www.westlakechemical.com .
SOURCE Westlake Chemical Corporation
CONTACT: David R. Hansen, Media Relations or Steven Bender, Investor Relations both of Westlake Chemical Corporation, +1-713-960-9111 Web site: http://www.westlakechemical.com