Dean Foods wraps early tenders for 94% of 9¾% notes, 5% of 7% notes

By Marisa Wong

Madison, Wis., Nov. 26 - Dean Foods Co. announced that holders tendered $376,188,000, or 94%, of its outstanding 9¾% senior notes due 2018 and $210,886,000, or 42%, of its outstanding 7% senior notes due 2016 as of 5 p.m. ET on Nov. 25, the early tender deadline of its previously announced tender offer and consent solicitation.

The company said it accepted for purchase all of the early tendered 9¾% notes and $23,812,000 of the early tendered 7% notes.

The company began the cash tender offer on Nov. 12 for up to $400 million principal amount of its $400 million 9¾% notes and $500 million 7% notes.

Because a combined total of more than $400 million principal amount of notes was tendered by the early tender deadline, $187,074,000 of the 7% notes will be returned to holders, and the company does not expect to accept for purchase any additional notes in the offers, according to a press release.

Tenders may no longer be withdrawn.

The offers are still set to expire at 11:59 p.m. ET on Dec. 10.

Pricing for each $1,000 principal amount was set at 2 p.m. ET on Nov. 25 using a reference security plus a fixed spread as follows, with the notes listed in order of priority acceptance level:

• The 9¾% notes were priced using the 0.25% U.S. Treasury notes due Dec. 15, 2014 plus 50 basis points for a purchase price of $1,143.73; and

• The 7% notes were priced based on the 1.75% U.S. Treasury notes due May 31, 2016 plus 115 bps for a purchase price of $1,133.28.

The total purchase price includes an early tender premium of $30.00 per $1,000 par amount of notes tendered by the early tender date.

Holders tendering their notes after the early tender deadline would receive the total payment less the early tender premium, which would be $1,113.73 for the 9¾% notes and $1,103.28 for the 7% notes.

The company also will pay accrued interest to but excluding the settlement date, which was Nov. 26 for the early tendered notes and will be Dec. 11 for any notes tendered and accepted after the early deadline.

As previously announced, Dean Foods also began a consent solicitation to amend the 9¾% notes to eliminate substantially all of the restrictive covenants and events of default.

Holders could not tender their notes without delivering consents or vice versa.

Consents were needed for a majority of the outstanding notes to approve the proposed amendments.

After receiving consents from holders of 94% of the outstanding 9¾% notes, the company executed a supplemental indenture effecting the changes.

BofA Merrill Lynch (888 292-0070 or 980 387-3907 collect) is the dealer manager and solicitation agent. Global Bondholder Services Corp. (866 470-3800 or 212 430-3774 collect) is the information agent.

Dean Foods is a Dallas-based food and beverage company.

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