Johnson Controls holders tender nearly 90% of equity units in offer

By Angela McDaniels

Tacoma, Wash., Sept. 28 - Johnson Controls, Inc. said about 8,082,000, or 89.8%, of its equity units in the form of corporate units were tendered during its exchange offer.

On Aug. 20, the company offered cash and common stock in exchange for up to 8.55 million of the equity units and for any and all of its 6.5% convertible senior notes due 2012.

The offer for the equity units expired at 11:59 p.m. ET on Sept. 25, and the offer for the convertibles expired on Sept. 17.

The company did not offer to exchange any equity units in the form of Treasury units.

For each equity unit, holders will receive 4.8579 shares of common stock, $6.50 in cash and a distribution consisting of the pro rata share of accrued interest on the company's 11½% subordinated notes due 2042 that form a part of the corporate units up to but excluding the settlement date, which is expected to be Sept. 30.

The company said it will issue about 39.3 million shares and pay roughly $52.5 million in cash for the equity units.

As previously reported, the company received tenders for $400.4 million, or about 99.5%, of the 6.5% convertibles.

For each $1,000 principal amount of convertibles, the payment is 89.3855 shares of common stock, $120 in cash and accrued interest up to but excluding the settlement date.

The company originally issued $402.5 million principal amount of the convertibles and 9 million corporate units in March 2009.

The notes are convertible into 89.3855 shares per $1,000 principal amount.

Each corporate unit consists of a purchase contract obligating the holder to purchase from the company shares of its common stock and a 5% undivided beneficial interest in $1,000 principal amount of the subordinated notes, owned by the holder but pledged to the company to secure the holder's obligations under the purchase contract.

The completion of each exchange offer was subject to the effectiveness of the registration statement relating to the exchange offers and, in the case of the corporate units exchange offer, the continued listing on the New York Stock Exchange of the corporate units that remain outstanding after the exchange offer.

Neither offer was conditioned on the completion of the other or on the tender of any minimum number of securities.

Bank of America Merrill Lynch (646 855-3401 or 888 292-0070) and Barclays Capital Inc. (212 528-7581 or 800 438-3242) were the joint lead dealer managers, and Citi was the co-dealer manager.

Global Bondholder Services Corp. (212 430-3774 or 866 389-1500) was the information and exchange agent.

Milwaukee-based Johnson Controls is an automotive and commercial building supplier.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.