Brazil's Odebrecht begins tender offers for 9 5/8%, 7½%, 7% notes

By Angela McDaniels

Tacoma, Wash., March 21 - Odebrecht Finance Ltd. began tender offers for its $200 million of 9 5/8% senior notes due 2014, its $400 million of 7½% senior notes due 2017 and its $500 million of 7% senior notes due 2020, according to a company news release.

Each series of notes is guaranteed by parent company Construtora Norberto Odebrecht SA.

Odebrecht Finance is also soliciting consents to proposed amendments to the indentures governing the notes that would eliminate substantially all of the restrictive covenants, including some restrictive covenants that currently do not apply because the notes have attained investment-grade ratings from two rating agencies. The proposed amendments would also eliminate various events of default and related provisions.

In order to amend an indenture, consents are needed from the holders of a majority of the notes governed by that indenture not held by the company or its affiliates. Holders who tender their notes must provide their consent.

For each $1,000 principal amount, the company will pay $1,190.00 for the 9 5/8% notes, $1,110.00 for the 7½% notes and $1,097.50 for the 7% notes. Each of these prices includes a consent payment of $30.00 per note.

Holders will also receive accrued interest up to but excluding the settlement date.

Each tender offer and consent solicitation will expire at 8 a.m. ET on March 30.

The tender offer for the 7% notes is subject to the condition that the company not receive tenders for more than a total of $500 million of notes in the offers. All three tender offers are subject to financing. They are not conditioned on the successful amendment of the note indentures.

Merrill Lynch (888 292-0070 or 980 388-9217) and HSBC Securities (USA) Inc. (888 HSBC-4LM or 212 525-5552) are the dealer managers and solicitation agents.

Construtora Norberto Odebrecht is an engineering and construction company based in Sao Paulo, Brazil.

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