Mexarrend
Docuformas Commences Tender Offer, Consent Solicitation for $150M 9.25% 2022 Bonds
Tue 07/02/2019 10:14 AM
Mexican independent leasing company Docuformas, S.A.P.I. de C.V. launched a cash tender offer for the repurchase of its outstanding $150 million 9.25% senior unsecured bonds due 2022. Docuformas also started a concurrent consent solicitation requesting the modification of indentures governing the 2022s.
The key terms to the tender offer appear in the following chart:
Docuformas set an early tender deadline of July 15 at 5 p.m. ET, wherein holders who validly tender their notes prior to that date will be eligible to receive a total consideration of $1,015 for every $1,000 principal amount on the notes.
The tender offer and consent solicitation are both scheduled to expire on July 29 at 11:59 p.m. ET, unless extended or modified by the company. Holders who validly tender their bonds after the early tender deadline but prior to the expiration date will be eligible to receive $965 for every $1,000 principal amount. This excludes a $50 early tender payment per every $1,000 in tendered notes.
In the consent solicitation, Docuformas is seeking to remove all restrictive covenants and certain events of default, as well as reduce the minimum notice period for redemption to three days instead of thirty days. Holders cannot participate in the consent solicitation unless they also validly tender their notes.
Docuformas has mandated Morgan Stanley & Co, UBS Securities and Banco BTG Pactual (Cayman Islands) to act as dealer managers and solicitation agents. D.F. King was tapped to serve as the tender and information agent.
Docuformas bondholders approved a consent solicitation last January to the indenture governing the issue. The amendments approved by holders included adding a 1.75% fixed charge coverage ratio test, and a debt carve-out restricting the company’s ability to raise debt capital.
The outstanding 2022 bonds were sold in Oct. 2017 at 99.023 to yield 9.5%, and proceeds from the deal were to be used in the prepayment of select liabilities. The issue also includes a call option effective Oct. 11, 2020, according to the prospectus of the notes. Bonds may be redeemed prior to Oct. 11, 2020 at a price equal to 100% of the principal amount, plus a make-whole amount and any additional interest. The make-whole amount is the greater of 100% of the principal amount of the bonds, or the value of the redemption price on Oct. 11, 2020 plus necessary interest payments between the redemption date and Oct. 11, 2020.
The 2022s have traded between 99 and par since late May to yield around 9.5%, according to MarketAxess. The performance of the outstanding notes over the past year appears below:
The key terms to the tender offer appear in the following chart:
Docuformas set an early tender deadline of July 15 at 5 p.m. ET, wherein holders who validly tender their notes prior to that date will be eligible to receive a total consideration of $1,015 for every $1,000 principal amount on the notes.
The tender offer and consent solicitation are both scheduled to expire on July 29 at 11:59 p.m. ET, unless extended or modified by the company. Holders who validly tender their bonds after the early tender deadline but prior to the expiration date will be eligible to receive $965 for every $1,000 principal amount. This excludes a $50 early tender payment per every $1,000 in tendered notes.
In the consent solicitation, Docuformas is seeking to remove all restrictive covenants and certain events of default, as well as reduce the minimum notice period for redemption to three days instead of thirty days. Holders cannot participate in the consent solicitation unless they also validly tender their notes.
Docuformas has mandated Morgan Stanley & Co, UBS Securities and Banco BTG Pactual (Cayman Islands) to act as dealer managers and solicitation agents. D.F. King was tapped to serve as the tender and information agent.
Docuformas bondholders approved a consent solicitation last January to the indenture governing the issue. The amendments approved by holders included adding a 1.75% fixed charge coverage ratio test, and a debt carve-out restricting the company’s ability to raise debt capital.
The outstanding 2022 bonds were sold in Oct. 2017 at 99.023 to yield 9.5%, and proceeds from the deal were to be used in the prepayment of select liabilities. The issue also includes a call option effective Oct. 11, 2020, according to the prospectus of the notes. Bonds may be redeemed prior to Oct. 11, 2020 at a price equal to 100% of the principal amount, plus a make-whole amount and any additional interest. The make-whole amount is the greater of 100% of the principal amount of the bonds, or the value of the redemption price on Oct. 11, 2020 plus necessary interest payments between the redemption date and Oct. 11, 2020.
The 2022s have traded between 99 and par since late May to yield around 9.5%, according to MarketAxess. The performance of the outstanding notes over the past year appears below:
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