First Data issues $6 billion notes in exchange for 9 7/8%, 10.55% notes

By Marisa Wong

Madison, Wis., Dec. 17 - First Data Corp. said that as of midnight ET on Dec. 15, the expiration date of its previously announced private exchange offers, it received tenders for $3.19 billion of 9 7/8% senior notes due 2015 and $3.26 billion of 10.55% senior payable-in-kind notes due 2015.

The company began exchange offers for its $3.75 billion of 9 7/8% senior notes due 2015 and $3.71 billion of 10.55% senior PIK notes due 2015 on Nov. 17.

The company offered new 8¼% senior second-lien notes due 2021, 8¾%/10% PIK toggle senior second-lien notes due 2022 and 12 5/8% senior notes due 2021.

On the settlement date, which is expected to be Dec. 17, the company will issue $6 billion of new notes in exchange for the old notes accepted in the offers. The new notes will be comprised of $1 billion of new PIK toggle notes, $2 billion of 8¼% notes and $3 billion of 12 5/8% notes.

Holders who tendered by 5 p.m. ET on Dec. 1, the early tender date, will receive $500 principal amount of new 12 5/8% notes plus $500 principal amount of, at each holder's election, new 8¼% notes or new PIK toggle notes per $1,000 of old notes.

Acceptance of old notes tendered was subject to proration. Holders who elected to receive new 8¼% notes in the form of new PIK toggle notes were subject to a proration rate of 0.94713584. Otherwise the proration rate was 0.89947090.

As a result of this proration, the company accepted for exchange $2.97 billion of the 9 7/8% notes and $3.04 billion of the 10.55% notes.

The demand for new PIK toggle notes exceeded the $1 billion cap. Holders of the PIK toggle notes will thus receive a portion of the new second-lien notes in the form of new PIK toggle notes and the balance in the form of 8¼% notes. Specifically, they will receive $250.302375 of new PIK toggle notes and $249.697625 of 8¼% notes per $500 of new second-lien notes.

Holders who tendered after the early tender date will receive $485 principal amount of new 12 5/8% notes plus $485 principal amount of new 8¼% notes.

The company will also pay accrued interest up to but excluding the settlement date.

The company initially noted that the exchange offers were subject to the receipt of at least $3 billion principal amount of old notes. Neither exchange offer was conditioned on the completion of the other.

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

First Data is an Atlanta-based provider of electronic commerce and payment services.

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