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UPDATE 1-CompuCredit shares up on plans to buyback notes, stock
* To buy back senior notes due 2025
* Says price of notes to be set by modified Dutch auction
* May buy back shares for $7 apiece after note repurchase
* Shares hit new 52-week high
(Adds analyst comment, updates stock movement)
April 15 (Reuters) - Shares of CompuCredit Holdings Corp CCRT.O rose 16 percent Thursday, hitting a new year high, a day after the company offered to buy back up to $100 million of senior notes due 2025 in a modified Dutch auction.
The marketer of branded credit cards and related financial services also plans to buy back shares for $7 apiece with the remaining amount.
The company said it would pay between $550 and $600 for each $1,000 note and would fund the repurchase with available cash on hand.
In January, the company had offered to buy back up to $160 million in senior notes.
However, the company said only $31.4 million of 2025 notes and $18.6 million of 2035 notes were tendered by Feb. 25.
"As a result, CompuCredit may have felt it necessary to increase its offer to entice more bondholders to the tender," analyst Sameer Gokhale of Keefe, Bruyette and Woods said in a note.
Gokhale added given the significant liquidity challenges the company faces, the bondholders may decide to take the current offer rather than risk receiving less in the future.
The tender offer is scheduled to expire on May 14.
Shares of the Atlanta, Georgia-based company touched a high of $6.74, before shedding some gains to trade at $6.44 in morning trade Thursday on the Nasdaq. (Reporting by Jochelle Mendonca in Bangalore; Editing by Anil D'Silva)
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