The interest will be paid on a semi-annual basis. The offer is expected to close on June 22, 2010, subject to customary closing conditions. Avnet intends to use the net proceeds from the sale of the securities for general corporate purposes.
As of April 3, 2010, Avnet had $992.61 million of total debt, up from $969.8 million as of June 27, 2009.
The long-term debt for the company includes 5.875% notes due in March 2014, 6.00% notes due September 2015, and 6.625% notes due September 2015. Avnet also has other long-term debt of $89.6 million.
Avnet also has a five-year $500.0 million unsecured revolving credit facility with a syndicate of banks, which expires in September 2012. In addition, there were $2.0 million in letters of credit issued under the facility. As of April 3, 2010, the company had outstanding borrowings of $85.2 million under this facility, which have been included in other long-term debt. As of June 27, 2009, there were $1.5 million in letters of credit issued under the credit facility.
We believe that a portion of the funds will be used for the Bell acquisition. In March 2010, Avnet entered into a definitive agreement to acquire Bell Microproducts Inc. (BELM) for $7.00 per share, representing an equity value of approximately $252 million.
The total transaction value is approximately $594 million, assuming a net debt position for Bell of $342 million at face value as of December 31, 2009.
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