Mexico’s Grupo Posadas buys back $269.16 million 7 7/8% notes so far

By Angela McDaniels

Tacoma, Wash., June 30 – Grupo Posadas, SAB de CV announced that early settlement of the tender offer for its $310 million of outstanding 7 7/8% senior notes due 2017 occurred on June 30 for all notes that were tendered by 5 p.m. ET on June 24, the early tender and consent time.

As previously reported, holders had tendered $269.16 million principal amount, or 86.83%, of the notes as of the early tender time.

The tender offer began on June 11 and will end at 8:30 a.m. ET on July 10.

The tenders and consents received as of the consent time were enough to execute a supplemental indenture on the early settlement date to implement the amendments for which consents were sought. The amendments eliminate or modify substantially all covenants restricting the ability of the company and its subsidiaries to take certain actions, such as incurring debt, sales of assets, transactions with affiliates, creation of liens and mergers and consolidations, as well as various events of default.

Holders who tender their notes must also consent to the proposed amendments, and they may not give consents without also tendering the notes.

In order to amend the notes, the company needed consents from holders of at least a majority of the outstanding notes.

The amendments became effective when the company accepted the tendered notes for purchase and paid for them.

The total purchase price is $1,060 for each $1,000 principal amount of notes. This includes an early consent payment of $30 per $1,000 principal amount of notes tendered by the early tender date.

The company also is paying accrued interest up to but excluding the applicable payment date.

The settlement date for notes tendered after the early tender date is expected to be July 13.

The tender offer is conditioned on financing. This condition has been satisfied. The company priced $350 million of 7 7/8% notes due 2022 at par to yield 7 7/8%.

Citigroup Global Markets Inc. (800 558-3745 or 212 723-6106), J.P. Morgan Securities LLC (866 846-2874 or 212 834-7279) and BofA Merrill Lynch (888 292-0070 or 646 855-3401) are the dealer managers and solicitation agents. Global Bondholder Services Corp. (866 470-4300 or 212 430-3774) is the information agent.

Grupo Posadas is a hotel chain based in Mexico City.

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