NCI Announces Debt Exchange Terms; Shares Plunge

HOUSTON (AP) — Metal building-components maker NCI Building Systems Inc. said Thursday it would proceed with an offer to exchange the notes of existing bondholders with cash and a minority stake in the company.

Shares plunged 82 cents, or 24 percent, to $2.66.

The company said it plans to launch the exchange offer on Friday, under amended terms that would see private equity firm Clayton, Dubilier & Rice Inc. take a 68.5 percent stake in NCI for $250 million in newly issued convertible participating preferred shares.

The investment would require existing convertible noteholders to agree to receive $500 in cash and 390 shares for each $1,000 in principal amount on the notes.

NCI said the investment is part of a plan to reduce debt by $323 million.

The terms require the approval of more than two-thirds of the outstanding convertible notes, and so far a majority has agreed, the company said. No final agreement has been reached, it said.

NCI also said that its senior credit facility lenders have extended waivers of their loan conditions until Nov. 6, giving the company more time to complete the refinancing.