Brazil’s USJ Acucar extends exchange offer for 2019, 2021 notes

By Marisa Wong

Morgantown, W.Va., May 2 – USJ – Acucar e Alcool SA further extended the period during which holders can receive a total exchange consideration under its exchange offer and consent solicitation launched on March 25, according to a Thursday press release.

The company is offering to exchange any and all of its $29,104,000 of outstanding 9 7/8% senior notes due 2019 and any and all of its $248,122,575 of outstanding 9 7/8%/12% senior secured PIK toggle notes due 2021 for newly issued 8˝%/9 7/8% senior secured notes due 2023, and, in the case of the 2019 notes only, new notes and cash.

The company is also soliciting consents to amend the 2021 notes’ indenture to eliminate substantially all of the restrictive covenants and some events of default and related provisions, as well as to terminate the security agreements and release the security interests in the collateral securing the 2021 notes.

The company said on Thursday that eligible holders who tender their existing notes and deliver consents by the new expiration date, 11:59 p.m. ET on May 14, will receive the total exchange consideration. The deadline to receive the total consideration was previously 11:59 p.m. ET on May 3, extended from 11:59 p.m. ET on April 19 and from 5 p.m. ET on April 5 originally.

As of 11:59 p.m. ET on April 30, holders had tendered and delivered consents for $4,406,000, or 15.14%, of the outstanding 2019 notes and $39,760,836, or 16.02%, of the outstanding 2021 notes.

For the 2019 notes, holders will receive in exchange for each $1,000 of existing notes a cash amount of $333 plus $667 of new notes. For the 2021 notes, holders will receive $1,000 of new notes for each $1,000 of existing notes accepted for exchange.

The exchange consideration includes accrued interest to the settlement date, at a rate of 10˝% instead of the applicable rate under the existing notes, which will be added to the principal amount of the new notes.

Holders who tender 2021 notes must also consent to the proposed amendments.

Holders of 2021 notes may not deliver consents without validly tendering the 2021 notes and may not revoke their consents without withdrawing the previously tendered 2021 notes to which they relate.

Adoption of the proposed amendments requires the delivery of consents by holders of at least 66 2/3% of outstanding 2021 notes.

Tenders for the 2019 notes may be withdrawn at any time prior to the expiration date. Tenders and consents for the 2021 notes may be withdrawn and revoked at any time prior to the execution of the supplemental indenture.

The exchange offer and consent solicitation are conditioned on the tender of at least 67% of the 2019 notes and at least 95% of the 2021 notes, among other things.

Morgan Stanley & Co. LLC and Santander Investment Securities Inc. are acting as dealer managers and solicitation agents.

D.F. King & Co., Inc. (212 269-5550 or 877 283-0318) is the information agent and exchange agent.

The sugarcane processing company is based in Sao Paulo.

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