Ziggo gets needed consents to amend 3 5/8% notes, meets minimum threshold under exchange offer

By Marisa Wong

Madison, Wis., Feb. 6 - Ziggo BV announced that it received tenders and corresponding consents from holders of a majority in principal amount of its 3 5/8% senior secured notes due March 27, 2020, enough to amend the indenture governing the notes.

Holders had tendered €390,213,000, or 52.03%, of the €750 million of outstanding 3 5/8% notes as of 5 p.m. ET on Feb. 5, according to a press release.

As a result of obtaining the required consents, the company will execute a supplemental indenture that eliminates substantially all of the restrictive covenants, some events of default and other covenants and rights.

Tenders may be withdrawn prior to the effective date of the supplemental indenture.

As noted before, the total purchase price will be €1,015 for each €1,000 principal amount notes tendered by 5 p.m. ET on Feb. 7, the early tender date.

The total payment includes an early tender amount of €5.00 per €1,000 principal amount.

Those who tender after the early tender deadline will receive €1,010 per €1,000 of notes.

The company also will pay accrued interest on Feb. 27, the payment date.

Holders may not tender their notes without delivering their consents.

The company began the tender offer for any and all of the 3 5/8% notes and related consent solicitation on Jan. 27. The offer expires at 11:59 p.m. ET on Feb. 24.

Credit Suisse, ABN AMRO, BofA Merrill Lynch, Credit Agricole CIB, Deutsche Bank, HSBC, ING, JPMorgan, Morgan Stanley, Nomura, Rabobank International, Scotiabank and Societe Generale Corporate & Investment Banking are the dealer managers.

Lucid Issuer Services Ltd. is the tender and tabulation agent and information agent.

Exchange offer

According to another press release on Thursday, Ziggo Bond Co. BV said it received tenders for more than €300 million of its 8% senior notes due 2018, thus satisfying the minimum tender condition of the exchange offer that began on Jan. 27.

The company is offering to exchange up to €934 million of its outstanding €1,208,850,000 of 8% notes for an equal amount of new 8% senior notes due 2018.

The exchange notes will in turn be automatically exchanged for an equal amount of new senior notes due 2024 to be issued by LGE Holdco VI BV, provided the acquisition of Ziggo NV by a wholly owned subsidiary of LGE Holdco, an indirect wholly owned subsidiary of Liberty Global plc, is completed within 15 months and two weeks of the announcement of the acquisition.

If the acquisition fails to go through by the longstop date, the notes will be exchanged for an equal amount of exchanged original notes, the company said.

On Wednesday, the company announced that interest on the new notes due 2024 will be 7 1/8%.

The new notes will be callable at 103.563 beginning May 15, 2019, at 102.375 beginning May 15, 2020, at 101.188 beginning May 15, 2021 and at par beginning May 15, 2022.

The company also may redeem up to 40% of the new notes due 2024 at 107.125 with proceeds of an equity offering, according to a prior press release.

Holders who tender their notes by 5 p.m. ET on Feb. 7, the early offer deadline, will receive a fee of €40 per €1,000 principal amount if the acquisition is completed by the longstop date.

If more than the exchange offer cap is tendered by the expiration of the offer, the existing 8% notes will be exchanged on a pro rata basis.

The exchange offer expires at 11:59 p.m. ET on Feb. 24.

Redemption

Concurrently, Ziggo Finance BV plans to redeem all of its outstanding €750 million 6 1/8% senior secured notes due 2017, according to a prior press release.

The company will redeem the notes at 103.063 plus accrued interest to the redemption date of March 4.

The total purchase price will be €790,709,479.50, including accrued interest of €17,736,979.50.

The paying agent is Deutsche Bank AG, London Branch.

Planned merger

As previously announced, Liberty Global plans to acquire Ziggo NV for about €10 billion in stock and cash.

In addition to the cash payment, Liberty Global and Ziggo expect to incur about €300 million of transaction and financing costs, including costs associated with refinancing, tendering and exchanging Ziggo debt.

Ziggo is an Utrecht, Netherlands-based television, internet and telephone services provider.

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