Russia’s Far-Eastern makes changes to tender offer for 8%, 8¾% notes

By Angela McDaniels

Tacoma, Wash., April 7 – Far-Eastern Shipping Co. plc made amendments to its tender offer for Far East Capital Ltd. SA’s $550 million of 8% senior secured notes due 2018 and $325 million of 8¾% senior secured notes due 2020, according to a company news release.

The company said it will not be able to accept instructions to tender from holders of notes issued under Rule 144A. It suggested that holders of Rule 144A notes who wish to participate contact the intermediary through which they hold their notes and instruct that intermediary to exchange their notes into Regulation S notes that can be tendered.

In addition, the early tender time was extended to 5 p.m. ET on April 17 from 5 p.m. ET on April 14.

The maximum payment amount for the two issues of notes remains $85 million.

As previously reported, the total consideration for each $1,000 principal amount of notes will be the sum of the minimum price and the clearing premium, which will be determined through a modified Dutch auction.

The total consideration will include an early tender payment of $50 per $1,000 principal amount of notes tendered by the early tender time.

Holders who tender must specify the minimum total consideration (the bid price) they would be willing to receive. The acceptable bid price range is $410 to $510 per $1,000 principal amount of 8% notes and $400 to $500 per $1,000 principal amount of 8¾% notes.

The bid premium for each tender of notes will be the bid price specified minus the minimum price.

The clearing premium for both issues of notes will be determined by consideration of the bid premiums of all tendered notes in order of lowest to highest bid premiums.

The clearing premium will be the lowest single premium for all tenders of notes of both issues such that, for all tenders of notes of both issues whose bid price results in a bid premium equal to or less than this lowest single premium, the company will be able to spend the maximum payment amount. Or, if the purchase of all tendered notes would result in the company spending less than the maximum payment amount, the clearing premium will be the highest bid premium with respect to any note of either issue tendered.

Holders will also receive accrued interest up to but excluding the settlement date.

The offer began March 31 and will expire at 5 p.m. ET on April 28. The settlement date is expected to be May 6.

The company will announce the final results of the offer, the principal amount of notes accepted for purchase, the clearing premium, the total consideration, the tender offer consideration and any proration allocation on April 29.

Morgan Stanley & Co. International plc (44 20 7677 5040, 800 624-1808 or 212 761-1057) is the dealer manager. D.F. King (44 207 920 9700, 212 269-5500 or 800 591-6309) is the tender agent.

The shipping company is based in Moscow.

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