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Kemet ups payment in tender offer for $175 million 2.25% convertibles
By Angela McDaniels
Tacoma, Wash., June 8 - Kemet Corp. increased the purchase price in the tender offer for its $175 million principal amount of 2.25% convertible senior notes due 2026 to $400 per $1,000 principal amount of notes from $300, according to a company news release.
Noteholders will also receive accrued interest to the payment date.
The company also decreased the minimum tender condition. Completion of the offer is now conditioned on the receipt of tenders for $122.5 million, or 70%, of the outstanding notes rather than $166.25 million, or 95%, of the notes.
The deadline was extended to 11:59 p.m. ET on June 19 from June 12. The offer was previously extended from June 2.
As of 4 p.m. ET on June 5, holders had tendered and not withdrawn $211,000 of the convertibles.
The company previously said it will finance the offer with a term loan under a credit facility with K Financing, LLC, an affiliate of Platinum Equity Capital Partners II, LP.
Because of the offer changes, the potential size of this term loan has been changed to $60.25 million from $52.5 million, and Kemet is now required to use up to $9.75 million of its cash on hand to purchase convertibles under the tender offer if more than $105,625,000 principal amount is tendered.
In connection with the tender offer, Kemet said it entered into some amendments to its €60 million credit facility and €35 million credit line with UniCredit Corporate Banking SpA. The amendments will become effective on completion of the tender prior to July 20.
Deutsche Bank Securities Inc. (800 503-4611) is the dealer manager. D.F. King & Co. (800 431-9643 or 212 269-5550) is the information agent.
Kemet is a Simpsonville, S.C.-based manufacturer of tantalum, multilayer ceramic, film, electrolytic paper and solid aluminum capacitors.
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