Carvana extends exchange offer, early tender premium two more weeks

By Mary-Katherine Stinson

Lexington, Ky., May 3 – Carvana Co. announced another two-week extension for its exchange offer for five series of notes, according to an 8-K filing with the Securities and Exchange Commission.

Further, all the early exchange premiums are being extended through the end of the offer.

The new deadline is 5 p.m. ET on May 17.

The exchange offer was originally scheduled to expire at 5 p.m. ET on April 19 and was then extended to 5 p.m. ET on May 3.

However, the withdrawal deadline has passed, and earlier tenders may no longer be withdrawn.

As a recap, the company is offering to exchange the existing unsecured notes for secured notes with a pay-in-kind toggle feature, at a premium to current trading prices.

Specifically, Carvana is offering to exchange the existing notes for up to $1 billion principal amount of new 9%/12% cash/PIK toggle senior secured second-lien notes due 2028.

The first six semiannual interest payment dates may be paid in kind. Thereafter, interest will be only in cash.

There is a minimum condition that at least $500 million principal amount of existing notes be validly tendered.

Tenders may be prorated.

Existing notes

Listed by acceptance priority level, Carvana is offering to exchange the following existing notes with the offered considerations:

• $500 million outstanding 5 5/8% senior notes due 2025 (Cusips: 146869AB8, U1468GAC8) for $858.75 of new notes per $1,000 of existing notes, $50 better than the original offer of $808.75;

• $3.275 billion outstanding 10¼% senior notes due 2030 (Cusips: 146869AJ1, U1468GAG9) for $793.75 of new notes per $1,000 of existing notes;

• $600 million outstanding 5½% senior notes due 2027 (Cusips: 146869AF9, U1468GAE4) for $658.75 of new notes per $1,000 of existing notes;

• $600 million outstanding 5 7/8% senior notes due 2028 (Cusips: 146869AD4, U1468GAD6) for $646.25 of new notes per $1,000 of existing notes; and

• $750 million outstanding 4 7/8% senior notes due 2029 (Cusips: 146869AH5, U1468GAF1) for $632.50 of new notes per $1,000 of existing notes.

All the considerations detailed above include a $20 early exchange premium that was only to be paid to holders who validly tendered their notes by the early deadline. But as mentioned above, the early premium is now extended through the end of the offer.

Tendering holders will also receive accrued interest to the settlement date.

Exchange details

Settlement is expected within five business days of the expiration time.

The exchange offers are conditioned on consents from the Ally banking group and any other required lenders or participants under Carvana’s floorplan facility.

Eligibility is based on investor type, and eligible holders may confirm their eligibility with the exchange and information agent.

D.F. King & Co., Inc. is the information and exchange agent for the offer (800 967-5084, 212 269-5550, www.dfking.com/carvana).

Carvana is a Tempe, Ariz.-based car retailer.

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