Starwood Hotels gives early tender results, increases maximum offer

By Toni Weeks

San Diego, Dec. 10 - Starwood Hotels & Resorts Worldwide, Inc. announced the early tender results of its cash tender offer for four series of notes and also increased some of the amounts it would accept in the offers.

As of 5 p.m. ET on Dec. 7, the early tender date, the company received tenders for $320,993,000 of its $499 million of 7.875% senior notes due 2014, $153,955,000 of its $450 million of 7.375% senior notes due 2015, $29,254,000 of its $400 million of 6.75% senior notes due 2018 and $40,245,000 of its $245 million of 7.15% senior notes due 2019. Starwood said it would accept for purchase all notes tendered by the early tender date. These notes may no longer be withdrawn.

When the offer began Nov. 28, the company planned to accept up to $515 million amount of notes. It will now tender for up to $559.2 million overall from the following four notes series:

• $499 million of 7.875% senior notes due 2014 with a maximum tender amount of $325 million and a payout of $1,130 per $1,000 principal amount;

• $450 million of 7.375% senior notes due 2015 with a maximum tender amount of $153,955,000, up from the $125 million of notes it initially planned to accept, and a payout of $1,173.75 per $1,000 principal amount;

• $400 million of 6.75% senior notes due 2018 with a maximum tender amount of $40 million and a payout of $1,221.25 per $1,000 principal amount; and

• $245 million of 7.15% senior notes due 2019 with a maximum tender amount of $40,245,000, up from the initial $25 million of notes it initially planned to accept, and a payout of $1,232.50 per $1,000 principal amount.

The tender considerations include a $30.00 tender premium for those who tendered prior to the early tender date.

The company is also offering accrued interest.

Starwood also solicited consents to amend the note indentures to reduce the minimum notice period prior to a redemption of the 7.875% notes due 2014 to three days from 30 business days. The company needed consents from the holders of a majority in principal amount of the notes, a condition which has now been met, and a supplemental indenture for these notes has now been effected.

The offer and solicitation will end at midnight ET on Dec. 21.

There is no minimum tender condition, but there is a financing condition.

Citigroup (800 558-3745 or 212 723-6106) and Bank of America Merrill Lynch (888 292-0700 or 980 387-3907) are the lead dealer managers and solicitation agents. J.P. Morgan (866 834-4666 or 212 834-4811) is the co-dealer manager and co-solicitation agent.

Global Bondholder Services Corp. is the depositary and the information agent (866 294-2200 or 212 430-3774).

Starwood is based in White Plains, NY. The company owns, operates and franchises hotels.

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