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Sherwin-Williams runs month-long exchange, consent bid for $1.55 billion of Valspar notes
By Susanna Moon
Chicago, May 2 – Sherwin-Williams Co. said it began offers to issue up to $1.55 billion principal amount of new notes in exchange for five note series issued by Valspar Corp. in connection with a planned merger.
Along with the exchange, Sherwin-Williams is soliciting consents on behalf of Valspar to amend the notes to eliminate covenants, restrictive provisions and events of default, according to a company announcement.
Specifically, Sherwin-Williams is offering to swap out Valspar’s $300 million 7.25% notes due June 15, 2019, $400 million 4.2% notes due Jan. 15, 2022, $250 million 3.3% notes due Feb. 1, 2025, $350 million 3.95% notes due Jan. 15, 2026 and $250 million 4.4% notes due Feb. 1, 2045.
The total exchange value will be $1,000 for each $1,000 principal amount of Valspar notes plus $1.00 in cash.
The total exchange amount includes an early tender premium of $30 principal amount of new Sherwin-Williams notes for each $1,000 principal amount of Valspar notes tendered by 5 p.m. ET on May 16, the early tender date.
Holders who tender for exchange after the early deadline will receive $970 principal amount of Sherwin-Williams for each $1,000 principal amount of Valspar notes.
The exchange offers will run until 5 p.m. ET on May 31.
Each exchange and consent solicitation requires completion of the other offers, although Sherwin-Williams said it may waive the condition.
The offers are contingent upon the acquisition of Valspar by Sherwin-Williams under the agreement dated March 19.
The exchange is being made only to holders who are qualified institutional buyers under Rule 144A or those who are not U.S. persons under Rule 902.
Global Bondholder Services Corp. (866 924-2200, 212 430-3774 or http://gbsc-usa.com/eligibility/sherwin-williams) is the exchange agent and information agent.
Sherwin-Williams is a Cleveland-based maker of paints and related products.
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