National Waterworks terminates 10½% notes consent solicitation

New York, Nov. 19 - National Waterworks Inc. said it has elected to withdraw its previously announced consent solicitation made to the holders of its 10½% senior subordinated notes due 2012, which was to have expired at 5 p.m. ET on Nov. 19.

The company - which was seeking noteholder permission to amend the indenture to allow it to make a special dividend payment to its corporate parent - said that it will continue to consider paying the dividend to the extent permitted by the indenture governing the notes.

As previously announced, National Waterworks, a Waco, Texas, distributor of components for water and wastewater systems, said on Oct. 29 that it had begun seeking the consent of holders of at least a majority of its outstanding principal amount of its 10½% notes to proposed indenture amendments.

It said that holders delivering valid consents by the expiration date would be eligible to receive a $20 per $1,000 principal amount consent payment - although no payment will now be made since the offer has been terminated.

National Waterworks was asking noteholders to amend the restricted payments covenant of the notes' indenture to permit the payment of a one-time $110 million dividend by the company to its corporate parent, National Waterworks Holdings Inc, which would enable Holdings to in turn pay a $110 million dividend to its stockholders.

The company said that it planned to incur an $80 million term loan under its senior credit facility during the fourth quarter, and it would have used the proceeds, together with internally generated cash, to pay the dividend.

The consummation of the consent solicitation - a necessary condition to the payment of the dividend - had been itself conditioned upon, among other things, the incurrence by National Waterworks of the term loan and by its obtaining an amendment to certain terms of its existing senior credit facility.

Goldman, Sachs & Co. (contact the Credit Liability Management division at 800 828-3182), J.P. Morgan Securities Inc. and UBS Securities LLC were the solicitation agents. The information agent was Global Bondholders Services Corp. (call the Corporate Actions department at 866 873-7700).

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.