CDW units add cap to tender offer for 11% notes, toggle notes, cancel consent solicitation

By Angela McDaniels

Tacoma, Wash., March 30 - CDW Corp. subsidiaries CDW LLC and CDW Finance Corp. added a cap to the tender offer for their $890 million of 11% senior exchange notes due 2015 and $316,974,000 of 11½%/12¼% senior PIK election exchange notes due 2015 and canceled their consent solicitation for the notes, according to a company news release.

The companies will purchase up to $665,138,000 principal amount of the notes. Previously, they were offering to purchase any and all notes tendered.

If the offer is oversubscribed, the sum of each holder's tendered notes accepted for purchase will be determined by multiplying each holder's tender by the proration factor and rounding the product down to the nearest $1,000, in the case of the 11% notes, and to the nearest $1, in the case of the PIK notes.

The companies already received enough consents to eliminate substantially all of the restrictive covenants and some events of default in the indenture. A supplemental indenture has been executed, but it will not become operative.

All holders who tender will receive $1,090 per $1,000 principal amount of notes. Previously, holders who tendered after 5 p.m. ET on March 7, the consent date, would have received $1,060 per $1,000 principal amount of notes.

The issuers will also pay accrued interest up to but excluding the payment date.

The tender offer began on Feb. 23 and will end at 8 a.m. ET on April 12, extended from March 31 and, prior to that, March 22.

Holders who tendered their notes by the consent date can withdraw their tenders until 5 p.m. ET on April 5.

As of 5 p.m. ET on March 28, holders had tendered $976,776,859 of notes including $759,207,000 of the 11% notes and $217,569,859 of the PIK notes.

The tender offer is subject to the consummation of a refinancing transaction yielding enough proceeds to fund it.

On March 29, CDW Escrow Corp. priced $725 million of 8½% senior notes due 2019. The proceeds will be deposited into a segregated escrow account and released to CDW LLC and CDW Finance if, as of the expiration date, at least $665,138,000 principal amount of notes have been tendered in the offer. The proceeds, together with borrowings under the companies' revolving credit facility, will then be used to fund the tender offer.

The dealer manager and solicitation agent is J.P. Morgan Securities LLC (800 245-8812 or 212 270-1200). The information agent and tender agent is D.F. King & Co., Inc. (800 290-6429 or 212 269-5550).

CDW is a Vernon Hills, Calif.-based provider of information technology solutions and services.

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