Vector Group gets tenders, consents for 81% of 11% notes by early date

By Susanna Moon

Chicago, Feb. 12 - Vector Group Ltd. said investors tendered $336,315,000, or about 81%, of its outstanding $415 million of 11% senior secured notes due 2015 by the consent deadline at 11:59 p.m. ET on Feb. 11.

All of the tendered notes were settled on Tuesday, according to a company press release.

As a result, the company received the needed consents to amend the notes to eliminate substantially all of the restrictive covenants and events of default, and the supplemental indenture to the notes became operative, the release noted.

The proposed changes required consents from holders of a majority of the outstanding notes, as noted before.

The company said it also called the remaining $78,685,000 principal amount of notes not tendered by the consent deadline for redemption at 103.667% of par on March 14.

The total purchase price was $1,042.92 per $1,000 principal amount for holders who tendered their notes and delivered their consents by the consent deadline. The total purchase price included a $30.00 consent payment.

Those who tender and consent after the consent date will receive the tender offer price of $1,012.92 per $1,000 of notes, which is the total purchase price less the consent payment.

The tender offer will continue until 12:01 a.m. ET on Feb. 27. The offer began on Jan. 29.

Tendered notes may no longer be withdrawn, as of the early tender deadline.

The company also paid, or will pay, accrued interest up to but excluding the settlement date.

The tender offer and consent solicitation are conditioned on completion of a debt financing, tenders by holders of the outstanding notes and execution of a supplemental indenture adopting the proposed amendments, all of which have now been satisfied.

Vector Group priced an upsized $450 million issue of eight-year senior secured notes at par to yield 7¾% on Feb. 4.

The company previously said the purpose of the tender offer was to improve its financial position by acquiring any and all of its outstanding notes and, together with the new debt financing, extend the maturity of its debt.

Jefferies & Co., Inc. (888 708-5831 or 203 708-5831) is the dealer manager for the tender offer and solicitation agent for the consent solicitation.

i-Deal LLC (212 849-3880 for brokers and banks or 888 593-9546 for all others) is the information agent and the tender agent.

Vector Group is a Miami-based holding company that indirectly owns Liggett Group LLC and Vector Tobacco Inc. and directly owns New Valley LLC. The subsidiaries manufacture and market cigarette products.

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