Chile’s Gildemeister cuts minimum tender condition in exchange offer

New York, Jan. 29 – Automotores Gildemeister SA said it has reduced the minimum tender requirement in its exchange offer for its 8¼% senior notes due 2021 and 6¾% senior notes due 2023. The new lower threshold has been passed, the company added.

The requirement is now that 92.5% of the existing notes be tendered, down from 95% originally.

As of 5 p.m. ET on Jan. 29, holders had tendered $648.34 million, or 92.62% of the notes.

Gildemeister said it expects to complete the offer subject to satisfaction of the remaining conditions.

At its previous announcement on Jan. 25, Gildemeister said investors had tendered $361,227,000, or 90.3%, of its 8¼% notes and $286,813,000, or 95.6%, of its 6¾% notes as of 5 p.m. ET on Jan. 22, the early tender date.

As a result, the early tender condition has been satisfied, according to a company news release.

The exchange offer will continue until 5 p.m. ET on Feb. 5. At the Jan. 25 announcement the expiration was extended from 5 p.m. ET on Jan. 20 and, before that, Jan. 13 and Jan. 6. The offer was previously extended from Jan. 27 and Jan. 20. The offer began on Dec. 17.

The company said on Jan. 22 that it will pay the early tender premium to all holders who tender in the offer, regardless of whether they tender before or after the early deadline.

As of 5 p.m. ET on Jan. 20, investors had tendered $360,677,000 principal amount, or 90.2%, of the 8¼% notes and $277,829,000 principal amount, or 92.6%, of the 6¾% notes.

That compares with tenders for $356,987,000 principal amount, or 89%, of the 8¼% notes and $274,979,000 principal amount, or 92%, of the 6¾% notes as of 5 p.m. ET on Jan. 13.

Holders had tendered $353,782,000 principal amount, or 88%, of the 8¼% notes and $273,484,000 principal amount, or 91%, of the 6¾% notes as of 5 p.m. ET on Jan. 6.

As previously reported, Gildemeister is soliciting consents to amend or waive provisions of the notes indentures to eliminate most restrictive covenants, some affirmative covenants and some events of default and to modify some conditions on acceleration and rescissions of acceleration.

In exchange for each $1,000 principal amount, the company is offering

• $576 principal amount of new senior secured notes;

• 393 shares of new preferred stock;

• One warrant;

• Additional principal amount of new senior secured notes equal to 60.7% of the accrued interest on the tendered notes through the settlement date; and

• An additional number of shares of new preferred stock equal to 39.3% of the accrued interest on the tendered notes through the settlement date divided by 1,000.

The company said it will also pay $31 principal amount of new senior secured notes for each $1,000 principal amount of notes tendered by the early tender date if at least 70% of the outstanding principal amount of each note series has been tendered by that date. This requirement was subsequently dropped and the extra $31 will be paid to all.

In the aggregate, the company is offering

• Up to $425 million principal amount of new 7½% senior secured notes;

• Up to $275 million of preferred stock, or 275,000 shares at a purchase price of $1,000 per share;

• Up to 700,000 warrants that, if 100% of the notes are tendered in the offers, will be exercisable for common shares equal to 40.0% of the company’s equity on a fully diluted basis; and

• An additional principal amount of new senior secured notes equal to 60.7% of accrued interest on the notes through the settlement date and an additional number of shares of new preferred stock equal to 39.3% of the accrued interest on the notes through the settlement date divided by 1,000 to be issued by the company.

The offers are only being made to holders who are qualified institutional buyers under Rule 144A or those who are not considered a U.S. person under Regulation S.

Prime Clerk (844 205-4334, 917 606-6438 or agexchange@primeclerk.com) is the exchange and information agent.

Automotores Gildemeister is an auto distributor based in Santiago, Chile.

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