Sonic Automotive Inc., four months after postponing debt payments to avoid bankruptcy, said Wednesday it had netted about $266 million from its sale of stock and convertible debt notes to refinance its debt.
The dealership group sold 10.4 million shares at $10.10 each and $173 million in convertible senior notes due in 2029, including the underwriters' options to purchase additional securities.
The $266 million in proceeds, before offering expenses, will go toward repaying at least some of the outstanding amount on its 4.25 percent debt notes due in 2015, which could be called due in November 2010. Sonic will also repay all its 6 percent debt notes due in 2012 and some of the amount outstanding on its credit line, the dealership group said in a statement.
The dealership group had announced the stock and senior note offering last week.
Sonic had $90 million of debt payments due in May, but lenders agreed to postpone that Sonic obligation until 2012. In exchange, the dealership group agreed to pay a higher interest rate -- 6 percent instead of 5.25 percent -- and raise $4 million through stock offerings.
On April 1, Sonic warned of possible bankruptcy if it wasn't able to restructure its debt. A few days after postponing its debt payments, Sonic ended two quarters of losses by posting a $1.7 million first-quarter profit.
Sonic ranks third on the Automotive News list of top U.S. 125 dealership groups, with retail sales of 114,442 new vehicles in 2008.