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KLX ups consent fee by 50% in bid to amend 5 7/8% notes for spinoff
By Susanna Moon
Chicago, June 5 – KLX Inc. said it has again increased the consent payment in the solicitation for its $1.2 billion of 5 7/8% senior notes due 2022 and pushed out the expiration by three days.
The aggregate consent payment is now $4.5 million, which will be paid out on a pro rata basis, according to a company update on Tuesday.
The solicitation also was extended until 5 p.m. ET on June 8 from 5 p.m. ET on June 5.
The company was originally offering a consent payment of $1.25 per $1,000 principal amount and then raised the payment to an aggregate amount of $3 million on June 4.
As announced May 30, the solicitation is being carried out in order to allow the planned spinoff to the company’s shareholders of KLX Energy Services Holdings, Inc. before the remainder of KLX Inc., its aerospace services group, is acquired by Boeing Co. Under the second part, KLX will merge with Boeing subsidiary Kelly Merger Sub, Inc., with KLX as the surviving entity.
KLX previously said it plans to carry out the spinoff first, then redeem the notes concurrently with the merger with Kelly.
If the consents are not received or if KLX delays the spinoff for any reason, the spinoff will be carried out simultaneously with the completion of the merger with Kelly and the notes will be redeemed.
Approval is needed from holders of a majority of the notes.
J.P. Morgan Securities LLC, Citigroup Global Markets Inc. and Goldman Sachs & Co. LLC are solicitation agents. Ipreo LLC (212 849-3880 or 888 593-9546) is information and tabulation agent.
KLX is a Wellington, Fla., distributor of aerospace fasteners and consumables, and provider of services and products to oil and gas exploration and production companies.
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