Nextel gets requisite consents from holders of 10.65% notes

New York, July 30 - Nextel Communications, Inc. (B2/B+) said that it had received a requisite number of consents to proposed indenture changes from the holders of its 10.65% senior redeemable discount notes due 2007, as part of its previously announced tender offer for the notes.

Nextel did not disclose the specific level of investor participation as of the July 30 expiration of the consent period.

It said it intends to enter into a supplemental indenture that implements the amendments, although these will not become operative until the notes tendered before the expiration of the consent solicitation are accepted and paid for by the company. When the amendments become operative, they will be binding on the holders of notes not tendered for purchase in the tender offer.

As previously announced, Nextel, a Reston, Va.-based wireless telecommunications operator, said on July 17 that it said it would sell $1 billion of new senior serial redeemable notes due 2015 in a public offering, and would use the proceeds, together with cash on hand, to repurchase the outstanding 10.65% notes through a tender offer or redemption transaction. It also said that it would redeem all of its outstanding 11 1/8% series E exchangeable preferred stock on Aug. 16 at a price of $1,055.625 per share, plus an amount equal to accrued but unpaid dividends on the shares.

On July 18, Nextel said that it had begun a cash tender offer and related consent solicitation for all of its $675.52 million outstanding principal amount of its 10.65% notes, and separately announced that it would also redeem all of the $392 million liquidation preference of outstanding 11 1/8% preferred shares.

Nextel said that the tender offer for the 10.65% notes would expire at midnight ET on Aug. 13, and set a consent deadline of 5 p.m. ET on July 30 (now expired), both subject to possible extension. The company said that notes validly tendered prior to the consent date could not be withdrawn and consents could not be revoked after the consent date. Notes tendered after the consent date could be withdrawn at any time before the expiration date of the tender offer.

The company said that the total consideration to be paid for each validly tendered note would be $1,036.25 per $1,000 principal amount of notes, plus accrued and unpaid interest up to, but not including, the scheduled payment date.

It said the total consideration would include a $20 per $1,000 principal amount payable only to those holders tendering their notes and thus validly delivering their consents prior to the consent deadline. Holders tendering after the consent deadline would receive the total consideration less the $20 consent payment, or $1,016.25 per $1,000 principal amount of the notes, plus accrued and unpaid interest.

Nextel said it was seeking noteholder consent to amendments that would eliminate substantially all of the indenture's restrictive covenants and would amend certain other provisions. It said that adoption of the proposed amendments would require the consent of the holders of at least a majority of the principal amount of the notes outstanding. Holders tendering their notes would be required to consent to the proposed amendments, while holders seeking to consent to the proposed amendments would have to tender their notes as well.

Nextel said the tender offer would be subject to, among other things, the now-fulfilled condition of receipt by Nextel of sufficient consents necessary to adopt the proposed amendments, as well as the completion by Nextel of certain previously announced related financing transactions.

On July 22, Nextel was heard by high yield syndicate sources to have sold $1 billion of new 7 3/8% senior notes due 2015.

Bear, Stearns & Co. Inc. is acting as the exclusive dealer manager and solicitation agent for the tender offer and the consent solicitation (call the Global Liability Management Group at 877 696-2327). D.F. King & Co., Inc. is the information agent (call (212 269-5550). The depositary for the tender offer is BNY Midwest Trust C.

Riverwood gets sufficient tenders of 10 7/8%, 10 5/8% notes

New York, July 30 - Riverwood International Corp. said that it had received note tenders and consents to proposed indenture changes from the holders of at least a majority of its outstanding 10 7/8% senior subordinated notes due 2008 and 10 5/8% senior notes due 2007 as part of its previously announced tender offer and related consent solicitation.

It said that as of 3.05 p.m. ET, approximately $293.5 million of the $400 million outstanding 10 7/8% notes had been tendered, along with approximately $150.6 million of the $250 million outstanding 10 5/8% notes issued in July 1997 and approximately $160.6 million of the $250 million outstanding 10 5/8% notes issued in June 2001.

The company said accordingly it set a consent expiration date of 5 p.m. ET on July 31, by which holders must tender in order to receive a consent payment as part of their consideration. It further said that already delivered consents to the proposed amendments could no longer be revoked and related tenders of notes could no longer be withdrawn.

Riverwood said it intends to promptly execute supplemental indentures incorporating the proposed changes for each series of notes with the trustees.

As previously announced, Riverwood, a Marietta, Ga.-based maker of paper and forest products, said on July 10 that it had begun a cash tender offer to buy any and all its outstanding 10 7/8% notes and its 10 5/8% senior notes, which had been issued in two series, in July 1997 and in June 2001, and was also soliciting consents to proposed indenture amendments which would eliminate substantially all the restrictive covenants, some repurchase rights and certain events of default and related provisions.

It set a consent deadline of 5 p.m. ET on July 30, and said the tender would expire at 12:01 a.m. ET on Aug. 7, with both deadlines subject to possible extension.

The company said that holders tendering their notes by the consent expiration date must consent to the amendments, and holders wishing to consent must also tender their notes.

Riverwood said it would pay $1,024.70 per $1,000 principal amount of the 10 7/8% notes and $1,032.92 per $1,000 principal amount of the 10 5/8% notes plus, accrued interest up to but not including the date of payment.

Holders tendering by the consent deadline would also receive a consent payment of $2.50 per $1,000 principal amount of notes tendered.

The offers for each series are separate and not dependent on each other.

Riverwood said completion of the tender offer would be subject to various conditions, including completion of the merger of Graphic Packaging International Corp with a subsidiary of Riverwood's parent Riverwood Holding, Inc., as well as completion of financing transactions related to the merger and the now-fullfilled condition of receipt of consents for the proposed amendments.

Goldman, Sachs & Co. (800 828- 3182) is the dealer manager for the offer and solicitation agent for the solicitation, MacKenzie Partners, Inc. (800 322-2885) is the information agent and Wells Fargo Bank Minnesota, NA is the depositary.

Zale completes 8½% note redemption

New York, July 30 - Zale Corp. (Ba1/BBB-) said it had completed the previously announced redemption of its 8½% senior notes due 2007.

As previously announced, Zale, a Dallas-based specialty retailer of jewelry, said on July 1 that it was calling for redemption the remaining $87 million of its 8 ½% notes. It said that it would fund the redemption from existing cash.

Zale concurrently announced a modified "Dutch Auction" tender offer to purchase up to 6.4 million shares of its outstanding common stock, or 20% of the current float, and further disclosed plans to enter into a new $500 million secured revolving credit facility, replacing its existing $225 million unsecured facility.

Zale announced completion of the new credit facity on July 24, and announced completion of the equity tender offer on July 30.

Silgan redeems $25 million 9% debentures

New York, July 30 - Silgan Holdings Inc. said it will redeem $25 million of its 9% senior subordinated debentures due 2009 on Aug. 29.

The Stamford, Conn. packaging manufacturer will pay 103.375% for the securities plus accrued and unpaid interest up to the redemption date.

Silgan currently has $500 million of the debentures outstanding.

Silgan said the redemption is part of its previously announced intention to repay debt over the next few years.

Flextronics may buy back notes with convertible proceeds

New York, July 30 - Flextronics International Ltd. said it will use proceeds from its offering of $500 million of convertible subordinated notes due 2010 to buy back its outstanding senior subordinated notes and for general corporate purposes.

Packaged Ice extends tender for 9¾% senior notes

New York, July 30 - Packaged Ice, Inc. said it extended the expiration date for its tender offer for its 9¾% series A senior notes due 2005 and 9¾% series B senior notes due 2005 to 9.00 a.m. ET on Aug. 15 from 5.00 p.m. ET on July 31.

The Dallas ice distributor said that as of the close of business on July 30 $230.4 million of the notes had been tendered.

On July 16 Packaged Ice said it obtained the necessary consents to amend the indentures of the two series of notes.

The company said that holders who provided consents by the deadline of 5.00 p.m. ET on July 16 will receive $1,025.63 per $1,000 principal amount of the notes including a consent payment of $1.25 per $1,000 principal amount if the company accepts for payment notes tendered in the tender offer.

Holders who tender after the consent deadline will not receive the consent payment.

By the close of business on Wednesday $230.4 million of the $255.0 million notes outstanding had been tendered.

The tender offer and consent solicitation are conditional on the completion of the merger with CAC Holdings Corp. and Cube Acquisition Corp., companies formed by Trimaran Fund Management, LLC and Bear Stearns Merchant Banking for the purpose, and the receipt of the necessary financing.

Georgeson Shareholder (800 293-7319) is the information agent. Credit Suisse First Boston LLC (call Liability Management Group at 800 820-1653), Bear, Stearns & Co. Inc. (call Global Liability Management Group at 877-696-BEAR (696-2327)) and CIBC World Markets Corp (contact Brian Perman at 800 274-2746) are the dealer managers for the offer and the solicitation.

Graphic Packaging increases price in tender offer, extends deadline

New York, July 30 - Graphic Packaging Corp. amended its tender offer for its 8 5/8% senior subordinated notes due 2012, increasing the price it is offering and extended the deadline.

The Golden, Colo. paperboard packaging company is now offering to pay $1,020.00 per $1,000 principal amount of validly tendered notes, up from $1,010.00 per $1,000 previously.

The consent payment remains at an additional $2.50 per $1,000 principal amount. All payments include accrued interest.

The consent solicitation will expire at least one day after Graphic Packaging announces it has received the necessary consents. Previously it was set to end at 5.00 p.m. ET on July 30.

The consent solicitation is to amend the indenture governing the notes to eliminate substantially all of the restrictive covenants and certain events of default and related provisions contained in the indenture.

The tender offer now ends at 12.01 a.m. ET August 13, pushed back from 12.01 a.m. ET on August 7.

At the close of business on July 29, $12.947 million of the $300 million outstanding 8 5/8% notes had been tendered.

Completion of the tender offer is subject to various conditions including completion of the merger of Graphic Packaging International Corp., the parent of Graphic Packaging, with a subsidiary of Riverwood Holding, Inc., completion of financing transactions related to the merger and receipt of consents for the proposed amendments.

Graphic Packaging noted that the tender is being made in anticipation of a change-of-control offer that it will be required to make under the note indenture. Notes not tendered in the offer or under the change-of-control offer will remain outstanding.

Graphic Packaging said neither it nor the combined company plans to redeem any non-tendered notes after the merger.

Goldman, Sachs & Co. (800 828-3182) is the dealer manager for the offer and solicitation agent for the solicitation, MacKenzie Partners, Inc. (800 322-2885) is the information agent and Wells Fargo Bank Minnesota, NA is the depositary.

Weight Watchers raises tender offer payment, extends consent solicitation

New York, July 30 - Weight Watchers International, Inc. amended its tender offer, increasing the amount it is offering to pay by reducing the spread used in the payment calculation.

The Woodbury, N.Y. company is now offering to pay an amount for the dollar notes based on a formula using 100 basis points over the yield of the 2.125% Treasury due Oct. 31, 2004 less $20 per $1,000 principal amount. The formula assumes the notes would otherwise be redeemed at $1,065 per $1,000 principal amount at their first call on Oct. 1, 2004. The spread was previously 200 basis points.

For the euro notes, Weight Watchers will pay an amount based on a formula using 100 basis points over the yield of the 4.25% Bundesobligation #133 due Nov. 26, 2004 less €20 per €1,000 principal amount. The formula assumes the notes would otherwise be redeemed at €1,065 per €1,000 principal amount at their first call on Oct. 1, 2004. The spread was previously 200 basis points.

The cash tender offer and consent solicitation applies to Weight Watchers' $150 million 13% senior subordinated notes due 2009 and €100 million 13% senior subordinated notes due 2009.

The consent solicitation now expires at midnight ET on Aug. 6 instead of 5.00 p.m. ET on Aug. 1. Holders who deliver consents by that deadline will receive either $20 per $1,000 principal amount or €20 per €1,000.

The tender offer will still expire at 5.00 p.m. ET on Aug. 18.

Credit Suisse First Boston LLC (212 538-4807 or 800 820-1653 (toll-free) or +44 207 883-5423 (outside U.S.)) and Merrill Lynch & Co. (212 449-4914 or 888 654-8637 (toll-free)) are the dealer managers and solicitation agents for the tender offer and consent solicitation. The information agent is D.F. King & Co., Inc. (212 269-5550 or 800 347-4750 (toll-free)).

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