Del Monte holders deliver needed consents for 6¾% and 7½% notes

By Susanna Moon

Chicago, Feb. 2 - Blue Merger Sub Inc. said holders tendered $241,462,000, or 96.58%, of the $250 million 6¾% senior subordinated notes due 2015 and $438,952,000, or 97.54%, of the $450 million 7½% senior subordinated notes due 2019 issued by Del Monte Foods Co.'s Del Monte Corp. subsidiary as of 5 p.m. ET on Feb. 1, the former consent date.

The consent payment deadline was extended to 5 p.m. ET on Feb. 4.

The company said it received consents from holders of a majority of the notes, which was needed to amend the notes to eliminate most of the restrictive covenants and some events of default and to modify the covenant regarding consolidations and mergers. Supplemental indentures have been executed and will become operative on the payment date.

The tender will end at 8 a.m. ET on Feb. 16. It began on Jan. 19.

Tendered notes could be withdrawn until 5 p.m. ET on Feb. 1.

The offers are part of the planned acquisition of Del Monte by Kohlberg Kravis Roberts & Co. LP, Vestar Capital Partners V, LP and Centerview Capital, LP.

For each $1,000 principal amount, Blue Merger is offering $1,025 for 6¾% notes and $1,235.45 for 7½% notes tendered before the consent deadline.

The payment for the 7½% notes was calculated as the present value of the $1,037.50 redemption price on Oct. 15, 2014 plus accrued interest up to but excluding the redemption date, discounted using 50 basis points over the yield to maturity of the 2 3/8% U.S. Treasury note due Sept. 30, 2014 as of 2 p.m. ET on Feb. 1, less accrued interest up to but excluding the settlement date of the offer.

The reference yield was 1.321%, and the offer yield was 1.821%.

In both cases, the amount includes a consent payment of $30 per $1,000 that will only be paid to holders who tender by the consent deadline.

Blue Merger will also pay accrued interest up to but excluding the settlement date.

Holders cannot tender without delivering consents or deliver consents without tendering.

The completion of the tender is subject to the acquisition of Del Monte having closed, the receipt of the necessary consents and other conditions.

The dealer managers and solicitation agents are Bank of America Merrill Lynch (888 292-0070 or call collect 980 388-9217), Morgan Stanley (800 624-1808 or call collect 212 761-0858), JPMorgan (800 245-8812 or call collect 212 270-1200), Barclays Capital (800 438-3242 or call collect 212 528-7581) and KKR Capital Markets LLC (call collect 212 230-9433).

Global Bondholder Services Corp. is the depositary and information agent (866 952-2200, banks and brokers may call collect 212 430-3774).

Del Monte is a San Francisco-based branded pet and consumer products company.

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