Post says it will also pay accrued and unpaid interest on thenotes. The buy-back offer expires at 5 p.m., Oct. 5. WachoviaSecurities and Merrill Lynch & Co. are the dealer managers forthe offer. Post filed its buy-back offer with the Securities andExchange Commission.

The purchase price for each $1,000 principal amount of noteswill be "the price resulting from a yield to maturity on the notes,equal to the sum of a fixed spread of 20 basis points, and theyield based on the bid price on the 1 ¼% US Treasury Notes due May31, 2005," according to the Post statement.

If favorable market conditions exist at the offer's settlementdate, Post may decide to finance all or a portion of the purchaseprice of the notes with the proceeds of an offering of new notes,the company says. However, if favorable market conditions are notin place, Post "expects to borrow funds under its unsecuredrevolving credit facility to pay the purchase price for the notes,plus accrued and unpaid interest," according to the Poststatement.