GTE Plans to Redeem Its $27-Million Debt Early

GTE California Inc., based in Thousand Oaks, plans to reduce its interest overhead by redeeming $27-million worth of debentures three years ahead of time.

The company will pay slightly more than par value to holders of the obligations and will then refinance the debt at a reduced interest rate.

GTE is now paying 8.875% on the sinking fund debentures, which raised $50 million when originally issued in 1971. The money was used to pay for the communications firm’s supplies and equipment, said spokesman Larry Cox.

“I believe we can borrow the amount that’s still owed at 3.75%, so the savings should be considerable,” Cox said.

The debentures, originally due in 1996, will be redeemed on May 15, resulting in an outlay of about $27.2 million.

GTE California is a unit of GTE Corp. of Stamford, Conn.