YUCAIPA EXPECTS TO SECURE SUFFICIENT MERGER CONSENTS

LOS ANGELES -- Yucaipa Cos. here expects to secure sufficient consents from its bondholders to proceed with the merger of Food 4 Less Supermarkets and Ralphs Grocery Co., Ron Burkle, managing partner for Yucaipa, told SN last week. Yucaipa has extended the deadline for exchange offers and consent solicitations until April 10. The original deadline was Feb. 23 but the company has extended the offer

LOS ANGELES -- Yucaipa Cos. here expects to secure sufficient consents from its bondholders to proceed with the merger of Food 4 Less Supermarkets and Ralphs Grocery Co., Ron Burkle, managing partner for Yucaipa, told SN last week. Yucaipa has extended the deadline for exchange offers and consent solicitations until April 10. The original deadline was Feb. 23 but the company has extended the offer several times since then.

worth of Food 4 Less bonds must consent to changes in their covenants that will allow them to trade their holdings, for a fee, for those in the new Ralphs. Burkle said at least 50% of two groups of Ralphs bondholders have already agreed to the exchange and 50% of two groups of Food 4 Less bondholders have agreed to consent to changes in their covenants. Negotiations are ongoing with the last group of Food 4 Less bondholders. The two sides are "only about $2-3 million apart" on the fee Yucaipa will pay them for their consents, Burkle told SN. He said he expects the discussions to ultimately come to a successful conclusion. If and when agreement is finally reached, Yucaipa will make a formal offer for bondholders to give their consents and exchange their holdings for notes in the new Ralphs. Once the offer is completed, Yucaipa expects to complete the merger within 30 days, Burkle said.