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Levi Strauss buys back 96.4% of 12¼% notes at close of tender offer
By Laura Lutz
Des Moines, Oct. 18 - Levi Strauss & Co. completed the tender offer for its 12¼% senior notes due 2012, accepting tenders for $506.2 million, or 96.4%, of the notes. The offer ended at midnight ET on Oct. 17.
There was $525 million principal amount of the notes outstanding when the tender began, on Sept. 20.
Holders had tendered $505.7 million, or 96.3%, of the notes by the consent deadline at 5 p.m. ET on Oct. 3.
The San Francisco-based clothing company was soliciting consents to amend the note indenture to eliminate or make less restrictive most of the restrictive covenants and certain related events of default.
In total, the company paid $563.7 million for the notes, including about $20 million in accrued interest and bout $15.2 million in consent payments.
As previously reported, Levi Strauss said it would pay $1,073 for each $1,000 principal amount of notes tendered by the consent deadline.
That payout was calculated using the present value, minus accrued interest, of $1,061.25 - the redemption amount of the notes on Dec. 15, 2007, the first call date - discounted using the 4.375% Treasury due Dec. 31, 2007 and 50 basis points, plus accrued interest up to but excluding the payment date.
The tender yield was 4.565% when pricing was set at 10 a.m. ET on Oct. 3.
The payout includes a consent payment of $30 per $1,000 principal amount that will be paid only to holders who tendered and deliver consents by the early deadline.
The tender was conditioned upon the company amending its senior secured revolving credit facility to increase its line of credit by an additional $200 million to $750 million, which shall include a $250 million tranche that is secured by the Levi's trademark in the United States.
Credit Suisse is the dealer manager and solicitation agent (collect 212 325-4951). D.F. King & Co., Inc. is the information agent (888 887-0082 or collect 212 269-5550).
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