Westfield holds meetings for two note series related to restructuring

By Susanna Moon

Chicago, Feb. 24 - Westfield Holdings Ltd. announced bondholder meetings for two series of notes related to the proposed restructuring of Westfield Group in separate company press releases.

The meetings will be held to propose amend the note terms to allow the companies to redeem the notes if the restructuring is proposed.

The company is soliciting consents for the £600 million guaranteed 5.5% notes due 2017 issued by WT Finance (Aust) Pty. Ltd., WEA Finance LLC and Westfield Europe Finance plc and the £450 million guaranteed 4.25% notes due 2022 issued by Westfield UK & Europe Finance plc, according to a previous press release.

The meeting for the 5.5% notes will be held at 5 a.m. ET on March 25, and the meeting for the 4.25% notes has been set for 5:15 a.m. ET on March 25.

Westfield Group's Australian and New Zealand business would be demerged from the international business, and the proposed merger of Westfield Group's Australian and New Zealand business with Westfield Retail Trust would create two new companies listed on the Australian Securities Exchange, as announced Dec. 4.

The redemption price would be the greater of par or at a price set at which the gross redemption yield on the notes is equal to the reference rate at 5 a.m. on the relevant record date plus 15 basis points.

The reference rate is the gross redemption yield on the 1.75% Treasury stock 2017 for the 5.5% notes and on the 4% Treasury Stock 2022 for the 4.25% notes while they are in issue and, after that, other U.K. Government Stock as reported in writing.

The early instruction fee will be £2.50 per £1,000 principal amount of notes for which electronic voting instructions are received by 11 a.m. ET on March 7, subject to approval of the measure.

Electronic voting instructions may be revoked by 5 a.m. ET on March 21, the instruction deadline.

In order to form a quorum, at least two-thirds of the outstanding principal amount notes must be represented at the meeting. And to pass, at least 75% of votes cast at the meeting must be in favor of the measure.

More offer details

If the measure passes, the company will pay holders who submitted electronic voting instructions for the notes by the early instruction deadline either in favor of, or against, the extraordinary resolution an early instruction fee, the company said.

Holders who submit electronic voting instructions that are received by the tabulation agent after the early instruction deadline or who arrange to be represented or to attend and vote at the meeting other than by way of electronic voting instructions instructing the principal paying agent to appoint the tabulation agent or any of its employees nominated by it to act as its proxy at the meeting will not be eligible to receive an early instruction fee.

The notes are currently represented by a global note, which is held by a common depositary for Euroclear Bank SA/NV and Clearstream Banking, societe anonyme.

Proposed changes

Under the amended terms, the issuers could give between 14 days and 60 days notice to redeem all or some of the notes from time to time at the redemption price plus accrued interest up to but excluding the redemption date.

If the restructuring occurs, the issuers could redeem all, but not some, of the notes at the redemption price plus accrued interest up to but excluding the redemption date after giving 14 days to 60 days notice.

In the case of a partial redemption, the total amount redeemed will be at least £50 million and in an integral multiple of £10 million, and the notes to be redeemed will be selected by lot as the trustee approves and deems fair.

The list of notes selected for redemption will be published 14 days to 60 days before the redemption date, along with a list of any notes previously called for redemption but that remain to be delivered for redemption and the principal amount of notes that will remain outstanding after the redemption.

The company noted that as long as all of the notes are represented by one or more global notes, no drawing of notes would be required and notes to be redeemed would be selected under the rules and procedures of Euroclear and Clearstream, Luxembourg.

The two new companies to be created under the proposed restructuring of Westfield Group would be Westfield Corp., comprising Westfield Group's international business, and Scentre Group, comprising the merged Australian and New Zealand business of Westfield Group with Westfield Retail Trust, the release noted.

The restructuring requires approval by the Supreme Court of New South Wales.

The solicitation agents are Credit Suisse Securities (Europe) Ltd. (attn: liability management desk, +44 0 20 7883 8763, email liability.management@credit-suisse.com) and Royal Bank of Scotland plc (attn: liability management group, +44 0 20 7085 5991, email liabilitymanagement@rbs.com).

The tabulation agent is Deutsche Bank AG, London Branch (attn: debt and agency services, +44 20 7547 5000 or email xchange.offer@db.com).

Offer background

The proposal has been considered by a special committee of the Association of British Insurers at the request of the parent guarantors, according to a press release.

The members of the Special Committee, who hold in aggregate about 39% of the current principal amount outstanding of the 2017 notes and 30% of the current principal amount outstanding of 2022 notes, have said that they plan to vote in favor of the notes proposal and that they will be inviting other ABI members to consider a similar course of action, the press release noted.

Westfield Group is a retail property company based in Sydney, Australia.

© 2015 Prospect News.
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