South Africa’s Edcon gets enough consents for 8% notes, 9¾%/12¾% notes

By Angela McDaniels

Tacoma, Wash., May 3 – Edcon Holdings Ltd. said Edcon Ltd. received enough consents to amend its 8% super senior PIK notes due 2019 and 9¾%/12¾% senior secured PIK toggle notes due 2019.

A consent solicitation for the notes began April 15 and ended April 21, according to a company filing with the London Stock Exchange.

For the proposed amendments to become effective, the company needed to receive consents from holders representing a majority in aggregate principal amount then outstanding of the 8% notes and the 9¾%/12¾% notes.

Other consent solicitation

As previously reported, the company is soliciting consents from the holders of its €300 million 9½% senior secured notes due 2018, €317 million 9½% senior secured notes due 2018 and $250 million 9½% senior secured notes due 2018.

The company is seeking consent to defer the March 15 and Sept. 15 interest payments until Dec. 14, 2016, to amend other terms of the notes and to allow the Edcon group to begin a compromise procedure under the South African Companies Act.

In addition, the noteholders are being asked to waive any defaults or events of default under the 9½% notes as a result of the non-payment of the March coupon.

According to the company, it is highly unlikely that it will have enough cash to both pay the March coupon and fund its near-term working capital requirements if the coupons are not deferred.

Consents are needed from the holders of at least 90% of the 9½% notes in order to make the interest deferral and 75% of the 9½% notes in order to make the proposed amendments and begin the compromise procedure.

The consent solicitation for the 9½% notes will end at 5 p.m. ET on May 5. The deadline was extended from April 28 and, prior to that, April 21.

Holders had given consents for 89% of the 9½% notes as of 2 p.m. ET on April 28, up from 84% of the notes as of April 21.

The information agent is Lucid Issuer Services Ltd. (+44 (0) 20 7704 0880 or edcon@lucid-is.com).

Edcon is a non-food retailer based in Johannesburg, South Africa.

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