Natura &Co launches tender offers, consent bids for 2028, 2029 notes

By Marisa Wong

Los Angeles, Sept. 8 – Natura &Co Luxembourg Holdings Sarl has begun two independent offers to purchase for cash (i) up to $550 million aggregate principal amount of its outstanding $1 billion 4 1/8% sustainability-linked notes due 2028 (Cusip: 63883KAB1, P7088CAC0); and (ii) up to $330 million aggregate principal amount of its outstanding $600 million 6% senior notes due 2029 (Cusip: 63884WAA6/L6S52V AA0), according to a press release late Thursday.

The company is offering a total consideration per $1,000 principal amount of $898.75 for the 2028 notes and $952.50 for the 2029 notes. The total consideration includes an early tender payment of $50 per $1,000 of notes tendered by the early tender date.

Holders tendering after the deadline will only be eligible to receive the tender offer consideration of $848.75 per $1,000 of 2028 notes and $902.50 per $1,000 of 2029 notes.

The company will also pay accrued interest.

Consent bids

Simultaneously with the tender offers, the company is conducting two independent consent solicitations: (i) a solicitation of consents from holders of the 2028 notes to effect some proposed amendments to the indenture governing the 2028 notes dated May 3, 2021; and (ii) a solicitation of consents from holders of the 2029 notes to effect some proposed amendments to the indenture governing the 2029 notes dated April 19, 2022.

Each series of notes is guaranteed by Natura &Co Holding SA and Natura Cosmeticos SA. On Aug. 28, Natura &Co Luxembourg had assumed all obligations as issuer under the 2028 notes from the original issuer Natura Cosmeticos; Natura Cosmeticos subsequently became a guarantor of the 2028 notes.

Bank of New York Mellon is trustee under both indentures.

The proposed amendments would amend some definitions; limit the applicability of the cross-default and judgments event of defaults to significant subsidiaries instead of subsidiaries; and, in the case of the 2028 notes indenture, limit the applicability of the limitation on liens covenant to significant subsidiaries instead of subsidiaries to be consistent with the 2029 notes.

For each series, the proposed amendments require the written consent of holders of a majority in aggregate principal amount of that series.

Holders may not tender their notes in the applicable tender offer without delivering their consents under the applicable consent solicitation.

However, at any time prior to or at the early tender date and consent deadline, holders may elect to deliver consents without tendering their notes.

If holders deliver consents by the early tender date or consent deadline and do not tender their notes or their tendered notes are not accepted for purchase due to oversubscription in the applicable tender offer, those holders are eligible to receive the consent fee, $2.50 per $1,000 principal amount.

Holders whose notes have been tendered and accepted for purchase under a tender offer will not be eligible to receive the consent fee.

Payment of the consent fee is conditioned upon receipt of the required consents.

Deadlines and details

The early tender date and consent deadline is 5 p.m. ET on Sept. 20.

Early settlement, if it occurs, will be on Sept. 21.

Each tender offer will expire at 5 p.m. ET on Oct. 5.

Final settlement is slated for Oct. 6.

The offer caps may be increased or decreased by the company at its discretion.

Tenders may be subject to proration.

In addition to the total consideration or tender offer consideration and accrued interest, and subject to the exceptions in the terms of the notes, Natura &Co Luxembourg will pay additional amounts such that the applicable purchase price and the applicable accrued interest received by holders after withholding tax, if any, will be equal to the amount that would have been due had there been no withholding tax.

The company reiterated that each tender offer is a separate tender offer and that each solicitation is a separate consent solicitation. Each tender offer and each solicitation may be individually amended, extended, terminated or withdrawn without amending, extending, terminating or withdrawing any other tender offer or solicitation.

The dealer managers and solicitation agents are BofA Securities, Inc. (888 292-0070 or 646 855-8988), Citigroup Global Markets Inc. (212 723-6106 or 800 558-3745), Itau BBA USA Securities, Inc. (888 770-4828 or 212 710-6749) and J.P. Morgan Securities LLC (866 846-2874 or 212 834-7279).

The tender and information agent is D.F. King & Co., Inc. (attn: Michael Horthman; fax: 212 709-3328, confirmation by phone: 212 232-3233; banks and brokers call: 212 269-5550, all others call: 800 487-4870; natura@dfking.com).

The Brazilian cosmetics company is based in Sao Paulo.

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