Liberty Media terminates offer for Telewest notes

Liberty TWSTY Bonds Inc. said on Wednesday (July 17) that it has terminated its previously announced tender offer for a portion of the notes and debentures of Telewest Communications plc (Caa3/BB-). In terminating the offer, Liberty TWSTY Bonds "noted the deterioration in the US and UK securities markets and the significant fall in the trading price of Liberty Media's common stock since the commencement of the Offer on June 12." It said that any notes and debentures which had been tendered by their holders under the offer will be promptly returned by Mellon Investor Services LLC, the depositary for the offer.

AS PREVIOUSLY ANNOUNCED, Liberty Media Corp. (Baa3/BBB-), an Englewood, Colo.-based company with interests in a broad range of video programming, broadband distribution, interactive technology services and communications businesses both in the U.S. and abroad, said on June 12 that it would begin a tender offer for the notes and debentures of London-based U.K. cable television and broadband operator Telewest Communications plc through its wholly owned Liberty TWSTY Bonds subsidiary. It said the tender offer would expire at 5 p.m. ET on July 11. It also set an early tender deadline of 5 p.m. ET on June 26, with holders tendering their bonds by that early deadline eligible to receive an additional payment of $30 per $1,000 principal amount of notes held or £30 per £1,000 principal amount as part of their consideration, depending on whether the bond in question is denominated in dollars or sterling. Both deadlines would be subject to possible extension. Liberty TWSTY said it would purchase A) up to $300 million principal amount of Telewest's 9 5/8% senior debentures due 2006 for a total price of $60 million, offering noteholders tender offer consideration of $410 per $1,000 principal amount, OR, for those noteholders tendering by the early tender deadline, $440 per $1,000 principal amount. It would purchase B) up to $350 million principal amount of Telewest's 11¼% senior notes due 2008 for a total price of $70 million, offering noteholders tender offer consideration of $420 per $1,000 principal amount, OR, for those noteholders tendering by the early tender deadline, $450 per $1,000 principal amount. It would purchase C) up to $350 million principal amount of Telewest's 9 7/8% senior notes due 2010 for a total price of $70 million, offering noteholders tender offer consideration of $415 per $1,000 principal amount, OR, for those noteholders tendering by the early tender deadline, $445 per $1,000 principal amount. It would purchase D) up to $1.536 billion principal amount of Telewest's 11% senior discount debentures due 2007 for a total price of $307.3 million, offering noteholders tender offer consideration of $420 per $1,000 principal amount, OR, for those noteholders tendering by the early tender deadline, $450 per $1,000 principal amount. It would purchase E) up to $500 million principal amount of Telewest's 9¼% senior discount notes due 2009 for a total price of $100 million, offering noteholders tender offer consideration of $332.50 per $1,000 principal amount, OR, for those noteholders tendering by the early tender deadline, $362.50 per $1,000 principal amount. It would purchase F) up to $450 million principal amount of Telewest's 11 3/8% senior discount notes due 2010 for a total price of $90 million, offering noteholders tender offer consideration of $292.50 per $1,000 principal amount, OR, for those noteholders tendering by the early tender deadline, $322.50 per $1,000 principal amount. It would purchase G) up to £180 million principal amount of Telewest's 9 7/8% sterling-denominated senior notes due 2010 for a total price of £36 million, offering noteholders tender offer consideration of £415 per £1,000 principal amount, OR, for those noteholders tendering by the early tender deadline, £445 per £1,000 principal amount. And it would purchase H) up to £325 million principal amount of Telewest's 9 7/8% sterling-denominated senior discount notes due 2009 for a total price of £60 million, offering noteholders tender offer consideration of £328.75 per £1,000 principal amount, OR, for those noteholders tendering by the early tender deadline, £358.75 per £1,000 principal amount. In addition, Liberty TWSTY Bonds will pay to all holders the accrued and unpaid interest on the principal amount of all tendered Telewest notes and debentures up to, but not including, the payment date. Liberty said that if the total amount of any series of securities that is validly tendered and not withdrawn by the expiration deadline exceeds the total offer amount for that series, then Liberty TWSTY Bonds would accept securities of that series for payment on a pro-rata basis. It said that the tender offer would be contingent upon, among other things, 20% of the aggregate principal amount of all of the outstanding securities subject to the offer having been validly tendered and not subsequently withdrawn by the tender offer expiration deadline.

On June 17, a committee representing a majority of the holders of all of Telewest's publicly issued bonds said in a statement that it was skeptical that the consummation of the previously announced proposed tender offer by Liberty TWSTY Bonds would facilitate a restructuring or other resolution of Telewest's debt problems in the best interests of bondholders as a whole. The committee -which said it had approached Telewest's board concerning a debt restructuring - said it wanted to discuss "urgently" with both Liberty Media and with Telewest its own proposals for a restructuring of Telewest's publicly issued bonds. The group said that it was in the process of appointing financial advisers and said it had requested meetings with Telewest and Liberty Media that week. It further said that bondholders interested in joining or supporting the committee (which it said should not, at this stage, involve becoming restricted) should contact Andrew Wilkinson of Cadwalader Wickersham & Taft, (call 011-44 (0)207 170 8700) the legal advisers to the committee.

On June 19, the Telewest bondholder's committee officially said that it was rejecting Liberty Media's offer for TWSTY's bonds, and that its members - which own more than 50% of Telewest's notes - said they will not participate in the offer. The members of the committee said in their statement that they consider acceptance of the Liberty tender offer to be "not in their best interests." The committee reiterated its desire to discuss with Liberty and Telewest its own proposals for a restructuring, and said that it was also asking for Liberty to disclose details of the restructuring plan which Liberty had stated, in its tender offer, that it intends to propose to Telewest. The committee retained UBS Warburg LLC as its financial advisor and, as previously announced, Cadwalader, Wickersham & Taft as its legal counsel.

On June 27, Liberty TWSTY Bonds Inc. said that the tender offer's early tender deadline had expired as scheduled at 5 p.m. ET on June 26 without extension. Liberty TWSTY Bonds said that as of that deadline, holders had tendered $72.22 million of Telewest's 9 5/8% senior debentures due 2006; $48.22 million of its 11¼% senior notes due 2008; $14.06 million of its 9 7/8% senior notes due 2010; $315.73 million of its 11% senior discount debentures due 2007; $88.16 million of its 9¼% senior discount notes due 2009; $23.49 million of its 11 3/8% senior discount notes due 2010; £46.43 million of its 9 7/8% sterling senior notes due 2010; and £35.09 million of its 9 7/8% sterling senior discount notes due 2009. Liberty TWSTY Bonds said that assuming the tender offer is consummated, those holders would receive the early tender payment as part of their compensation for securities accepted for purchase, as previously outlined. It said that withdrawal rights had now have been terminated, and notes and debentures tendered at any time after the early tender payment may could not be withdrawn (such withdrawal rights were subsequently reinstated). Liberty TWSTY further said that it beneficially owns $472 million total aggregate principal amount of notes and debentures of the various series being sought in the offer (using an exchange rate of US $1.52 per £1). $210 million of those bonds were purchased on Wednesday (June 26) in two privately negotiated transactions, at prices below the purchase prices for those series being offered in the tender offer.

On July 4, Telewest said that it had agreed to meet with both bondholders and Liberty Media to discuss restructuring the company's balance sheet. Telewest offered no further details in its letter to its shareholders.

On July 10 , Liberty TWSTY Bonds said that that the federal court hearing a lawsuit brought by some of the Telewest bondholders against the previously announced tender offer had postponed until July 18 any decision concerning a request by the plaintiffs that the court bar Liberty TWSTY Bonds from proceeding with the tender. Earlier Wednesday, Liberty TWSTY Bonds said that it had extended the expiration date for the tender offer to 5:00 p.m. ET on July 19 from the previously scheduled July 11 deadline, and reinstated withdrawal rights with respect to the tender offer. Liberty TWSTY Bonds said that as of 5 p.m. ET on July 9, holders had tendered $73.51 million of the $300 million outstanding principal amount of 9 5/8% senior debentures due 2006, up from the $72.22 million which had been tendered as of the expiration of the early tender deadline at 5 p.m. ET on June 26, the last time previously that the amount of notes tendered had been tabulated by the offer's depositary. Holders had also tendered $48.7 million of the $350 million outstanding principal amount of 11 ¼% senior notes due 2008, up from $48.22 million; they had tendered $14.38 million of the $350 million outstanding principal amount of 9 7/8% senior notes due 2010, up from $14.06 million; they had tendered $315.93 million of the $1.536 billion outstanding principal amount at maturity of 11% senior discount debentures due 2007, up from $315.73 million; they had tendered $88.31 million of the $500 million outstanding principal amount at maturity of 9 ¼% senior discount notes due 2009, up from $88.16 million; they had tendered $60.48 million of the $450 million outstanding principal amount at maturity of 11 3/8% senior discount notes due 2010, up from $23.49 million; they had tendered £46.43 million of the £180 million outstanding principal amount 9 7/8% sterling senior notes due 2010, unchanged from previously; and they had tendered £35.09 million of the £325 million outstanding principal amount at maturity of the 9 7/8% sterling senior discount notes due 2009, unchanged from previously. Liberty TWSTY Bonds said that it was amending the offer to permit holders of Telewest's notes and debentures to withdraw their tender of such securities at any time prior to the expiration date of the offer (such withdrawal rights had previously been withdrawn following the expiration of the early tender deadline, as previously announced). Liberty TWSTY Bonds noted the lawsuit against the tender offer, filed in the U.S. District Court for the Southern District of New York, captioned Angelo, Gordon & Co., LP, et al v. Liberty TWSTY Bonds, Inc., et al.; it said that although it believed that its offer to purchase the bonds complies with the requirements of all applicable securities laws, it had extended the offer's expiration deadline as outlined and has reinstated noteholders' withdrawal rights to give holders of Telewest notes and debentures adequate time to review a Supplement to the official Offer to Purchase, dated July 10, summarizing the material allegations of the lawsuit and the relief requested by the plaintiffs, and to then evaluate for themselves the merits of the tender offer in light of the allegations made in the lawsuit.

Lehman Brothers Inc. (call Scott Macklin at 800-438-3242 or 212-528-7581) is the dealer manager for Liberty Media's tender offer and Mellon Investor Services LLC (call 888-788-1635) is the information agent and depositary for the offer.

Telex extends exchange offer for 13% '06 notes

Telex Communications, Inc. (Ca) said on Tuesday (July 16) that it has extended the expiration date for its pending exchange offer for its 13% senior subordinated discount notes due 2006. The Burnsville, Minn-based manufacturer of audio, wireless and multimedia communications equipment plans to exchange new notes registered under the Securities Act of 1933 for its existing notes, which have not been registered for public trading. The exchange offer, which began on May 31 (although it was not publicly announced at that time; word of the offer was sent to the noteholders via a prospectus), was extended to 5 p.m. ET on July 26.

The company said that tenders of $105,088,063 principal amount (or 99.99%) of the existing note had been received under the terms of the exchange offer. BNY Midwest Trust Company (call Diane Amoroso, at 212 235-2353, or by fax to 212 235-2261) is the exchange agent.

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