Oak Extends Its Exchange Offer, Delaying Payments

Just as its “grace period” for back interest payments expired, Oak Industries Inc. on Friday extended until March 13 its offer to exchange stock, warrants and notes for $230 million in three outstanding debenture issues and further delayed back interest payments.

At least 70% of the debentures must be tendered to complete the offering, but so far only about 65% have been offered for exchange.

The cash-strapped media and cable-television equipment manufacturer said it will pay back interest on the 10.5% debenture issue when the exchange offer ends.

Oak said such a delay would normally have put it in default. But under the terms of that debenture offering, at least 25% of the holders have to agree to effectuate a default. As of Friday afternoon, more than 80% of the 10.5% debentures had been tendered, thus making a default impossible.

Meanwhile, the company announced that a Federal Communications Commission administrative law judge denied Oak’s request to renew its license to operate WSNS-TV in Chicago.

Oak, which owns 49% of the station, said it will continue to operate the station with its partners while appeals are pending.

The company also said it is shuting down its Racal Electronics Plc. joint venture “as it does not appear to have a reasonable chance to become profitable in the near future.”

Oak said the unit, which provides cable-television equipment in Europe, had slightly more than $1 million in sales last year.

Mitsui Mining & Smelting Co. said it exercised an option to increase its share of the Oak-Mitsui Inc. joint venture to 49% from 20%.

The Hoosick Falls, N.Y.-based company, which produces copper foil for printed circuit boards, is one of Oak’s few profitable units.