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Crum Forster begins tender offer, consent solicitation for 10 3/8% notes
By Angela McDaniels
Seattle, April 23 - Crum & Forster Holdings Corp. has begun a tender offer to purchase any of its $300 million 10 3/8% senior notes due 2013, according to an 8-K report filed with the Securities and Exchange Commission on Monday.
The company also began a consent solicitation to eliminate substantially all the covenants, some events of default and selected other provisions in the note indenture and to modify other provisions.
The consent solicitation will expire at midnight ET on May 4, and the tender offer will end at midnight ET on May 18.
The tender consideration will be the yield to the first call date - June 15, 2008 - equal to the sum of the bid-side yield of the 4 7/8% Treasury note due May 31, 2008 at 2 p.m. ET on May 4 plus 50 basis points. The consideration will include a consent payment of $30.00 per $1,000 principal amount of notes tendered before the consent solicitation expiration.
The company will also pay accrued interest up to but excluding the settlement date.
The tender offer is subject to the receipt of consents from holders of a majority of the notes and sufficient funding to pay for the tendered notes. Crum & Forster plans to fund the offer with cash on hand and with proceeds from a new issue of senior debt securities.
Merrill Lynch & Co. (888 654-8637 or 212 449-4914) is the dealer manager and solicitation agent, and D.F. King & Co., Inc. (800 290-6429) is the tender agent and information agent.
Crum & Forster is an insurance company based in Morristown, N.J., and a subsidiary of Fairfax Financial Holdings Ltd., which is a Toronto-based financial services holding company.
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