Exide Technologies Bonds Fall to Record Low After Plant Closing
Bonds of Exide Technologies (XIDE), a lead-acid battery producer, plunged to the lowest level ever after California regulators ordered it to close a recycling unit because of health risks.
The company’s $674.2 million of 8.625 percent, first-lien notes due February 2018 dropped 4 cents on the dollar to 65 cents to yield 20.5 percent at 2:43 p.m. in New York, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. The securities have fallen 14.3 cents since April 23.
The California Department of Toxic Substances and Control ordered the company to suspend operations at its Vernon, California, plant on April 24, alleging that the facility isn’t in compliance with the state’s health risk standards, the company said yesterday in a regulatory filing.
Exide hired Lazard Ltd. (LAZ) to advise it on financing alternatives and restructuring activities, the Milton, Georgia- based company said in an April 4 statement.
The company has $730 million of debt, including a $56 million convertible due Sept. 18, according to data compiled by Bloomberg. It had $80 million in cash and cash equivalents on Dec. 31 and paid $71.8 million in interest expense last year, when it reported net income of $56.7 million.
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