BURLINGTON, N.C.--(BUSINESS WIRE)--May. 11, 2009--
Laboratory Corporation of America® Holdings (LabCorp®) (NYSE:LH)
announced today that it will exercise its option to redeem $369.1
million principal amount (at maturity) of its Zero Coupon Convertible
Subordinated Notes due 2021 (Zero Coupon Notes), equaling fifty percent
(50%) of the principal amount (at maturity) outstanding of the Zero
Coupon Notes, on June 10, 2009 and all of its outstanding zero coupon
subordinated Liquid Yield Option™ Notes due 2021 (LYONs). The
Company expects that the total cash used for this redemption will be
approximately $289.6 million, which is expected to be funded from cash
on hand. The Company does not expect the redemption to have a
significant impact on its net income, earnings per share or operating
cash flow for 2009 and is maintaining its previously issued guidance for
2009.
“By redeeming this convertible debt with existing liquidity, LabCorp is
able to strengthen its capital structure and reduce the uncertainty
related to potential conversions of these securities in the future,”
said William B. Hayes, Chief Financial Officer. “By acting now, the
Company also expects to defer certain tax consequences of the
redemption.”
At March 31, 2009, LabCorp had an aggregate of $576.3 million of
accreted principal amount outstanding of the Zero-Coupon Notes and of
the LYONs. As a result of the redemptions, LabCorp will reduce the
outstanding accreted principal amount of this convertible debt by
approximately $289.6 million, leaving approximately $286.7 million in
accreted principal amount, or $369.1 million of principal amount at
maturity, of the Zero Coupon Notes outstanding.
The Bank of New York Mellon, as Trustee under the indenture governing
the Zero Coupon Notes, has informed LabCorp that it intends to redeem
the Zero Coupon Notes pro rata and in accordance with the applicable
indenture. The Trustee has determined the pro rata principal amount at
maturity of each Zero Coupon Note entitled for redemption and conversion
as of the close of business, 5:00 p.m., New York City time, on May 11,
2009.
This press release does not constitute a notice of redemption of the
Zero Coupon Notes or LYONs. The redemption is being made solely pursuant
to a notice of redemption dated May 11, 2009, which will be delivered by
the Trustee to the holders of the LYONs and the Zero Coupon Notes
selected for redemption by the Trustee.
About LabCorp®
Laboratory Corporation of America® Holdings, a S&P 500 company, is a
pioneer in commercializing new diagnostic technologies and the first in
its industry to embrace genomic testing. With annual revenues of $4.5
billion in 2008, over 28,000 employees worldwide, and more than 220,000
clients, LabCorp offers clinical assays ranging from routine blood
analyses to HIV and genomic testing. LabCorp combines its expertise in
innovative clinical testing technology with its Centers of Excellence:
The Center for Molecular Biology and Pathology, National Genetics
Institute, Inc., ViroMed Laboratories, Inc., The Center for Esoteric
Testing, Litholink Corporation, DIANON Systems, Inc., US LABS, and
Esoterix and its Colorado Coagulation, Endocrine Sciences, and Cytometry
Associates laboratories. LabCorp conducts clinical trial testing through
its Esoterix Clinical Trials Services division. LabCorp clients include
physicians, government agencies, managed care organizations, hospitals,
clinical labs, and pharmaceutical companies. To learn more about our
organization, visit our Web site at: www.labcorp.com.
This press release contains forward-looking statements. Each of the
forward-looking statements is subject to change based on various
important factors, including without limitation, competitive actions in
the marketplace and adverse actions of governmental and other
third-party payors. Actual results could differ materially from those
suggested by these forward-looking statements. Further information on
potential factors that could affect LabCorp’s financial results is
included in the Company’s Form 10-K for the year ended December 31,
2008, and subsequent SEC filings.
Source: Laboratory Corporation of America(R) Holdings
LabCorp®
Bill Bonello, 336-436-7732
Company Information:
www.labcorp.com
