Volume Services extends tender for 11¼% notes

New York, Nov. 21 - Volume Services America, Inc. (B3/B-) said it has extended its previously announced tender offer and related consent solicitation for its outstanding 11¼% senior subordinated notes due 2009.

The offer was extended to midnight ET on Dec. 8 - subject to possible further extension - from the original deadline of midnight ET on Nov. 21. The depositary for the offer said that as of midnight ET on Nov. 20 around 82% of the notes had been tendered.

The tender was extended so that it would close at the same time as the anticipated closing of the offering of Income Deposit Securities by Volume Services America's parent company, Volume Services America Holdings, Inc., which is one of the conditions to the tender offer.

The response means the company has received the necessary consents in its solicitation, which required approval of holders of at least a majority of the securities.

Volume Services said consents and tenders may not now be validly withdrawn unless the company reduces the amount of the tender offer consideration, the early consent premium or the principal amount of notes subject to the tender offer or is otherwise required by law to permit withdrawal.

As previously announced, Volume Services, a Spartanburg, S.C.-based provider of catering, concessions, merchandise and facilities management services for sports facilities, convention centers and other entertainment venues, said on Oct. 23 that it was making a cash tender offer for all of the $100 million outstanding principal amount of the 11¼% notes, as well as the related solicitation of noteholder consents to proposed indenture changes.

The company set 5 p.m. ET on Nov. 6 as the now-expired early consent deadline, and originally said the tender offer would expire at midnight ET on Nov. 21, which has now been extended.

Volume Services America said that it would pay tendering noteholders $1,062.79 per $1,000 principal amount of notes validly tendered and accepted for purchase, plus accrued and unpaid interest up to, but not including, the payment date.

In addition, noteholders tendering their notes and providing consents to the proposed amendments by the early consent deadline would receive an early consent premium of $20 per $1,000 principal amount.

Volume Services said that the tender offer would be subject to several conditions, including receipt by the company of valid and unrevoked consents from holders of a majority in principal amount of the notes by the expiration deadline and the consummation of an offering of Income Deposit Securities by Volume Services America Holdings. The net proceeds of the Income Deposit Securities offer will be used to fund the tender for the 11¼% notes among other things.

On Nov. 12, the company said that it had received consents and tenders for more than 80% of the outstanding bonds by the Nov. 6 early consent deadline - meaning it had gotten the necessary consents in its solicitation.

Volume Services said consents and tenders, therefore, could no longer be validly withdrawn unless the company were to reduce the amount of the tender offer consideration, the early consent premium or the principal amount of notes subject to the tender offer, or be otherwise required by law to permit withdrawal.

The dealer manager for the tender offer is CIBC World Markets Corp. (contact Brian Perman at 212 885-4489). The information agent is Innisfree M&A Inc. (investors call toll-free at 888 750-5834, banks and brokerage firms call 212 750-5833). The depositary for the offer is Wells Fargo Bank Minnesota, NA.

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