Flextronics gets tenders for $558.19 million notes in oversubscribed offer for 6¼%, 6½% notes

By Angela McDaniels

Tacoma, Wash., July 1 - Flextronics International Ltd. said it received tenders for $339,681,000 of its $399,622,000 principal amount of 6½% senior subordinated notes due May 15, 2013 and for $218,511,000 of its $402.09 million principal amount of 6¼% senior subordinated notes due 2014 during a tender offer and consent solicitation that expired at midnight ET on June 30.

The company offered to purchase up to $100 million of each series of notes. Because the offer is oversubscribed, the company accepted only $99,816,000 of the 6½% notes and $99,918,000 of the 6¼% notes.

The proration factor is 29.39% for the 6½% notes and 45.73% for the 6¼% notes, according to a company news release.

For each $1,000 principal amount, Flextronics will pay par for the 6½% notes and $963 for the 6¼% notes. Both payouts include a $30 early tender premium and separate consent fee for those who tendered by the early deadline, which was 5 p.m. ET on June 19. The early deadline was extended from June 16 and, before that, June 11.

The consent fee is $23 for the 6¼% notes and $10 for the 6½% notes. When the offer began on May 29, there was a $10 consent fee for the 6¼% notes.

After increasing the fee and extending the offer to June 30 from June 25, the company had received consents from holders of $214.3 million, or 53.3%, of its 6¼% notes and tenders from holders of $165.8 million, or 41.2%, of those notes. In addition, it received consents from holders of $317.5 million, or 79.5%, of its 6½% notes and tenders from $5.5 million, or 1.4%, of those notes.

The consents were enough to execute a supplemental indenture incorporating the proposed amendments. It will go into effect when the company buys the notes, which was expected to occur "promptly" after the expiration.

The company was soliciting consents to make amendments to the indentures that:

• Restart, as of April 1, the calculation period for determining its restricted payments capacity;

• Exclude certain non-cash charges from the calculation of cumulative consolidated net income for purposes of calculating the restricted payments capacity;

• Permit Flextronics to redeem, repurchase, retire or otherwise acquire any portion or all of its outstanding 1% convertible subordinated notes due Aug. 1, 2010; and

• Permit the company and its restricted subsidiaries to make additional restricted payments of up to $250 million, down from $500 million, in addition to any other permitted restricted payments.

The company needed consents from holders of a majority of each of the notes series.

U.S. Bank NA is the information agent (800 934-6802, #7, #7 or call collect 651 495-4738). The dealer managers are Credit Suisse Securities (USA) LLC (212 538-1861 or 800 820-1653) and Deutsche Bank Securities Inc. (212 250-6008 or 866 627-0391).

Flextronics is a Singapore-based company that provides manufacturing services to electronics companies.

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