Windstream extends consent bid for two note series until Nov. 27

By Susanna Moon

Chicago, Nov. 17 – Windstream Holdings, Inc. said it extended the consent solicitations for two series of notes issued by Windstream Services, LLC.

As announced Oct. 19, the company is holding exchange offers and consent bids for $650,947,000 of 7¾% senior notes due 2020, $809.31 million of 7¾% senior notes due 2021, $441,151,000 of 7½% senior notes due 2022 and $343,457,000 of 7½% senior notes due 2023.

For the 2021 notes and 2022 notes, the consent solicitations will now continue until 11:59 p.m. ET on Nov. 27, extended from 11:59 p.m. ET on Nov. 16 and before that 5 p.m. ET on Nov. 14.

Windstream is seeking consents from holders of a majority of four note series to waive alleged defaults for transactions related to the spinoff of Uniti Group, Inc. and to amend the indentures governing the notes to give effect to those waivers and amendments.

The issuer said it also obtained the needed consents to amend the 2020 notes and the 2023 notes by the end of the solicitation at 5 p.m. ET on Nov. 1.

The company secured the needed majority of consents to amend its 6 3/8% senior notes due 2023 in the solicitation that ended at 5 p.m. ET on Nov. 6, extended from 5 p.m. ET on Nov. 3.

Windstream executed a supplemental indenture to the 6 3/8% notes, and the proposed waivers and amendments are now operative, the release noted.

Exchange offers

The exchange offers were set to end at 11:59 p.m. ET on Nov. 16, extended from 11:59 p.m. ET on Nov. 14. Final settlement has been set for Nov. 22.

Holders had tendered the following amount of notes as of the previous deadline:

• $167.5 million principal amount, or 37.96%, of the 2022 notes, of which $373,000 was tendered after the early deadline;

• $222.9 million principal amount, or 64.91%, of the outstanding 2023 notes, of which about $5.7 million was tendered after the early deadline; and

• $212.5 million principal amount, or 26.26%, of the outstanding 2021 notes, of which about $828,000 was tendered after the early deadline.

For the 2020 notes, investors had tendered $195,365,000 principal amount, or 30%, of the outstanding 2020 notes as of the early deadline.

The issuer accepted for exchange $157.97 million principal amount of the 2020 notes on a prorated basis in exchange for about $150 million principal amount of new secured notes.

Because the offer for the 2020 notes was oversubscribed by the early deadline, no more notes will be accepted for exchange.

The company said on Nov. 7 that it had issued $553.7 million principal amount of new 6 3/8% notes and about $200 million principal amount of new secured notes in exchange for four series of notes tendered by the early deadline of 5 p.m. ET on Oct. 31.

Windstream settled the early tenders on Nov. 6.

For the 7½% senior notes due 2022 and 7½% senior notes due 2023, Windstream is offering new 6 3/8% senior notes due 2023.

The company will issue $1,080 of the new notes for each $1,000 principal amount of the 7½% senior notes due 2022 and $1,075 of new notes for each $1,000 principal amount of the 7½% senior notes due 2023.

Both figures included $50 of new notes per $1,000 that was issued to holders who participated by the early tender date.

After that deadline, the amount on offer is $1,030 for the 2022 notes and $1,025 for the 2023 notes.

As previously announced, the company accepted for exchange $179,871,000 of the 2021 notes on a prorated basis and in exchange issued $139,843,000 principal amount of new 6 3/8% notes and about $50 million principal amount of 8 5/8% senior first-lien notes due 2025.

In exchange for the 2022 notes and 2023 notes, the company issued $413,857,000 principal amount of new 6 3/8% notes.

Windstream will also pay accrued interest up to but excluding the settlement date in cash.

More details

For the 7¾% senior notes due 2021, holders have two options.

They may choose new 6 3/8% senior notes due 2023, in which case the company will issue $1,100 principal amount of new notes for each $1,000 principal amount of existing notes.

Alternatively they may opt for new secured notes due 2021 in which case Windstream will issue up to $50 million of the new notes at the rate of $950 principal amount per $1,000 principal amount of existing notes.

If this option is oversubscribed, holders then have a further choice for any notes beyond those accepted for exchange into new secured notes. They may either exchange the excess notes for new 6 3/8% notes due 2023 at the rate of $1,100 principal amount of new notes for each $1,000 principal amount of existing notes or exchange the excess notes on the same terms subject to a cap on the new 6 3/8% notes of $587 million less the amount issued in the offer for the 2022 and 2023 notes and the amount issued under the first option for the 2021 notes. The cap is now reduced to $282 million.

As with the exchange for the 2022 and 2023 notes, all the amounts on offer include $50 of new notes per $1,000 that will only be issued to holders who participate by the early tender date of 5 p.m. ET on Oct. 31.

Windstream will also pay accrued interest up to but excluding the settlement date in cash.

For Windstream’s 7¾% senior notes due 2020, holders will receive new secured notes due 2021 at the rate of $950 principal amount per $1,000 principal amount of existing notes.

The amount of new notes that may be issued is capped at $50 million.

As with the other exchanges, the amount on offer includes $50 of new notes per $1,000 that will only be issued to holders who participate by the early tender date of 5 p.m. ET on Oct. 31.

The exchange ends at 11:59 p.m. ET on Nov. 14.

Windstream will also pay accrued interest up to but excluding the settlement date in cash.

The early settlement date is now expected to be Nov. 3 but may be rescheduled, the company noted.

Windstream said it denies that the alleged default has occurred and has filed a complaint seeking a judicial declaration that there has been no default in connection with the spinoff and related transactions.

Global Bondholder Services Corp. (866 807-2200 or 212 430-3774) is information and exchange agent.

The company is also offering $250 million of new secured notes.

Windstream is a Little Rock, Ark.-based networking and telecommunications company.

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