QVC tenders for any and all 7 1/8% notes, $250 million of 7½% notes

By Toni Weeks

San Luis Obispo, Calif., March 4 - QVC, Inc. began a cash tender offer for any and all of its outstanding $500 million of 7 1/8% senior secured notes due 2017 and up to $250 million of its outstanding $1 billion of 7½% senior secured notes due 2019, according to a press release.

The purchase price for the 7 1/8% notes will be $1,039.40 per $1,000 principal amount of notes tendered by the expiration date for these notes, 5 p.m. March 15. There is no early tender payment or deadline for these notes.

The price for the 7½% notes will be determined based on a modified Dutch auction procedure. Holders who tender their notes by 5 p.m. ET on March 15 will receive an early tender payment of $30 per $1,000 of notes.

In the Dutch auction, the total consideration will be the sum of the base price, which is also the minimum bid price, plus the clearing premium, which will be determined following the auction. Each holder will specify a bid price that represents the minimum consideration a holder is willing to receive. The bid price must fall within the acceptable bid price range of $1,105 to $1,120 per $1,000 principal amount of notes and be in increments of $1.25.

The clearing premium will be the lowest single bid premium, or the amount by which the bid price exceeds the base price, at which QVC will be able to purchase the notes in a principal amount equal to the $250 million cap. If the amount of notes tendered at or below the clearing premium would cause QVC to purchase more than the cap amount for the tender offer, the company will prorate the amount of notes purchased.

QVC will also pay accrued interest from the last interest payment date up to but not including the applicable settlement date.

Notes from either series may be validly withdrawn at any time up to 5 p.m. ET on March 15.

The company said it has the right to increase the Dutch tender cap for the 7½% notes. If it does so, however, it does not currently intend to extend the withdrawal deadline.

The tender offer for the7½% notes will expire at 11:59 p.m. ET on April 1.

The offers are conditioned upon QVC obtaining enough new financing to pay for the tendered notes.

Barclays (800 438-3242 or collect 212 528-7581), J.P. Morgan Securities LLC (866 834-4666 or collect 212 834-4811), Wells Fargo Securities, LLC (866 309-6316 or collect 704 410-4760), BNP Paribas Securities Corp., BofA Merrill Lynch and Mitsubishi EFJ Securities (USA), Inc. are the dealer managers for the offers.

Global Bondholders Services Corp. (866 470-3800 or collect 212 430-3774) is the information agent and depositary.

West Chester, Pa.-based QVC, a wholly owned subsidiary of Liberty Interactive Corp., is a home shopping retailer.

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