Liz Claiborne wraps early tender for 5% notes, waives offer condition

By Susanna Moon

Chicago, March 24 - Liz Claiborne, Inc. said that investors tendered €117.89 million of its €350 million of 5% notes due 2013 as of the consent deadline at 12:01 a.m. ET on March 22.

The company is offering to purchase up to €155 million principal amount of the 5% notes and is asking noteholders to consider an extraordinary resolution to amend the notes to allow issuing new secured debt with proceeds to be used to redeem, repurchase, prepay, defease, refund or refinance the notes.

Liz Claiborne said that given the positive response, it will waive the condition that the measure pass in order to repurchase the notes.

The resolution permits changing the note terms to allow incurring new secured debt so that the company may repurchase the notes in the offer even if the measure is not passed by noteholders, according to a company press release.

The offer still is conditioned on the company securing new financing to fund the offer. The company said on March 8 that it planned to issue new senior secured notes in conjunction with its tender offer for the 5% notes.

As previously noted, holders who tendered by the early tender date will receive €960 for each €1,000 principal amount, including an early tender and consent fee of 2% of par.

The tender offer will continue until 12:01 a.m. ET on April 5.

Those who tender after the early date will receive the total payment less the early tender fee.

The company also will pay accrued interest up to but excluding the settlement date of April 7.

If the amount of notes tendered exceeds the offer cap, the company will accept notes for payment on a pro rata basis.

Liz Claiborne previously said the purpose of the offer is to manage its liability profile and upcoming maturities by refinancing some outstanding notes with proceeds from new senior secured notes in order to maintain the company's financial flexibility.

Merrill Lynch International (+44 20 7995 3715) and J.P. Morgan Securities Ltd. (+ 44 20 7325 9633) are the dealer managers for the offer, and Deutsche Bank AG, London Branch (+44 20 7547 5000) is the tender agent.

Liz Claiborne is a New York-based designer and marketer of apparel and accessories.

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