Technicolor solicits consents from debtholders, announces tender offer

By Angela McDaniels

Tacoma, Wash., June 11 - Technicolor announced a tender offer and a consent solicitation for its existing debt.

Technicolor wants to refinance its outstanding senior secured debt, which consists of participations in its credit agreement and notes issued under a note purchase agreement. As of May 31, the debt totaled €1.19 billion and had an average interest rate of 8.2%.

The company is soliciting consents to complete the refinancing transaction and to make some changes to the terms of its existing debt.

If the proposed amendments become effective, each noteholder will receive a 1% consent fee regardless of whether they consented to the amendments.

Lenders under the credit agreement that consent to the proposed amendments prior to 5 p.m. ET on June 24 and are lenders when the proposed amendments become effective will receive a 1% consent fee.

If the proposed amendments are approved, they are expected to become effective on July 10, and the consent fees are expected to be paid July 11.

Tender offer

Separately from Technicolor's consent solicitation, Tech Finance & Co SCA is offering to acquire any and all of Technicolor's outstanding notes and outstanding participations in its credit agreement.

Tech Finance is an independent, standalone special-purpose vehicle.

Noteholders who tender prior to 5 p.m. ET on June 24 will receive 114% of par. Those who tender after the early deadline but prior to 11:59 p.m. ET on July 9 will receive 111% of par.

The company will also pay accrued interest up to but excluding the settlement date, which is expected to be July 11 for notes tendered by the early deadline and July 15 for notes tendered after that but prior to the final deadline.

Lenders who submit their participations under the credit agreement for purchase prior to June 24 will receive 100.5% of par on or about July 11.

Conditions

The tender offer is conditioned on the proposed amendments becoming effective and Tech Finance receiving enough financing.

The proposed amendments are conditioned on the receipt of consents of more than two-thirds of the total participations under the credit agreement and at least 50.1% of the principal amount of outstanding notes, more than two-thirds of the total participations under the credit agreement being submitted for purchase, at least 50.1% of the notes being tendered in the tender offer and Tech Finance receiving adequate financing for the tender offer.

Tech Finance expects to fund the tender offer with $330 million of senior notes due 2020 and a €745 million senior secured term loan due 2020.

The dealer managers and solicitation agents are J.P. Morgan Securities plc, Goldman Sachs International and Morgan Stanley & Co. LLC.

Technicolor is a Paris-based provider of video technologies, systems, finished products and services to the media and entertainment industry.

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