CSK Auto tendering for 12% notes

New York, Dec. 16 - CSK Auto Corp. (B2/B) said that it had begun a cash tender offer for all $280 million of the outstanding 12% senior notes due 2006 issued by its CSK Auto Inc. subsidiary, and was also soliciting noteholder consents to proposed changes in the notes' indenture.

CSK set a consent deadline of 5 p.m. ET on Dec. 31. It said the consideration for the notes would be set at 10 a.m. ET on Jan. 2 and the tender offer will expire at midnight ET on Jan. 15, with all deadlines subject to possible extension.

CSK said the tender offer consideration would be set at the pricing deadline, using a formula based upon a 100-basis point fixed spread over the yield at that time of the reference security, the

2.00% U.S. Treasury note due Nov. 30, 2004. The pricing formula assumes that the notes would otherwise be redeemed in full at a price of $1,060 per $1,000 principal amount of notes tendered on Dec . 15, 2004, which is the earliest date on which the notes may be redeemed.

The total consideration will include a $20 per $1,000 principal amount consent payment for those holders who tender their notes and thus deliver their consents to the proposed indenture amendments eliminating substantially all of the restrictive covenants and certain default provisions by the consent deadline. Noteholders tendering after the consent deadline will not receive the consent payment, but only the tender offer consideration.

All tendering noteholders will also receive the accrued and unpaid interest up to, but not including, the payment date. The settlement date is currently expected to be Jan. 16, subject to possible extension.

Noteholders who wish to tender their notes must also consent to the proposed indenture amendments and they may not deliver consents without also tendering the related notes. Holders may not revoke consents without also withdrawing the notes tendered under the terms of the tender offer. Holders who tender their notes and deliver their consents at or before the consent deadline may withdraw their tenders and revoke their consents at any time up to that deadline, but may not do so afterwards, except as may be required by law.

CSK said that the tender offer and consent solicitation is part of its plan to refinance its existing debt in order to reduce its annual interest expense. The tender offer and consent solicitation will be funded by a previously announced $100 million increase in the company's existing senior credit facility to $425 million, by the issuance of $200 million of new notes and with cash on hand.

Among other factors, the tender offer is conditioned upon the receipt of consents from holders of a majority in principal amount of the notes, and the successful completion of the replacement financing, consisting of the new bond offering and senior credit facility amendment.

Credit Suisse First Boston LLC is the dealer-manager and solicitation agent for the tender offer and consent solicitation (call Liability Management Group at 800 820-1653). MacKenzie Partners, Inc. is the information agent (212 929-5500).

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