Brazil's Minerva announces increase to tender cap for 12¼% notes

By Angela McDaniels

Tacoma, Wash., Jan. 17 - Minerva SA subsidiary Minerva Luxembourg SA announced that HSBC Securities (USA) Inc. increased the amount of notes it will purchase in its tender offer.

HSBC is offering to repurchase any and all of Minerva Luxembourg's outstanding $33,883,000 of 9½% notes due 2017, any and all of its $372,057,000 of 10 7/8% notes due 2019 and up to a maximum amount of its outstanding $450 million of 12¼% notes due 2022. Each series of notes is guaranteed by Minerva.

According to a press release, the maximum amount HSBC will pay for 12¼% notes will be equal to $850 million - increased from $500 million - less the aggregate amount paid for 9½% notes and 10 7/8% notes purchased on the early settlement date. If the tender offer for the 12¼% notes is oversubscribed as of the early tender date, the company will prorate the accepted notes.

Minerva Luxembourg also announced that HSBC is now soliciting consents from the holders of the 12¼% notes to amend some provisions, including some restrictive covenants and events of defaults, of the indenture governing the 12¼% notes to conform those provisions to the corresponding provisions negotiated in connection with Minerva Luxembourg's proposed issuance of new notes due 2023. The proposed amendments will not modify the redemption provisions or the change of control definition.

The proposed amendments require the consents of holders of a majority of the outstanding 12¼% notes (excluding any 12¼% notes held by Minerva Luxembourg or its affiliates).

Holders who tender their 12¼% notes will also be providing consents; however, no separate consent fee is being paid.

Background

The offers began Jan. 11 and will expire at midnight ET on Feb. 8.

For each $1,000 principal amount of notes tendered by 5 p.m. ET on Jan. 25, the early tender date, HSBC will pay $1,105.00 for the 9½% notes, $1,200.00 for the 10 7/8% notes and $1,262.50 for the 12¼% notes. In each case, the amounts include an early tender payment of $30.00 per $1,000 principal amount. Holders who tender after the early tender date will not receive the $30.00 early tender premium.

The company will also pay accrued interest.

HSBC is also soliciting consents from the holders of the 10 7/8% notes to eliminate substantially all of the restrictive covenants and various events of default and related provisions in the note indenture. The company needs consents from a majority of the outstanding 10 7/8% notes to effect the amendments, and holders who tender their 10 7/8% notes will also be providing consents to the amendments.

There will be no separate consent fee paid to holders who consent to the amendments.

According to a prior news release, the purpose of the tender offers is to lengthen and smooth Minerva Luxembourg's debt maturity profile. HSBC intends to exchange the repurchased notes for new notes in an international capital markets offering.

The tender offers are not conditioned on the tender of a minimum principal amount of notes, only on a new financing condition.

Banco BTG Pactual, Cayman Branch, Credit Suisse Securities (USA) LLC and HSBC Securities (USA) Inc. are the dealer managers and solicitation agents.

D.F. King & Co., Inc. (800 488-8035, 212 269-5550 or Minerva@dfking.com) is the information agent.

Minerva is a food processing company based in Barretos, Brazil.

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