Navistar tenders for 6¼%, 7½%, 9 3/8% notes

New York, Feb. 21 - Navistar International Corp. said it has begun cash tender offers and consent solicitations for its $400 million principal amount of 6¼% senior notes due 2012, $250 million principal amount 7½% senior notes due 2011 and $393 million principal amount 9?% senior notes due 2006.

Navistar said the offer will allow bondholders who believe the company is in default to redeem their securities.

Funding will come from the company's recently announced $1.5 billion credit facility.

"Thanks to the $1.5 billion commitment from our relationship banks, Navistar will be able to tender for its outstanding senior notes, thereby controlling our capital structure and giving confidence to our customers, suppliers and other important constituents that we will be able to execute on our strategic plan," said Daniel C. Ustian, chairman, president and chief executive officer, in a news release.

"As previously announced, the trustee of our public debt has notified the company that it is in default on various issuances of the company's existing debt because we have not yet filed our annual report on form 10-K for fiscal year ended 2005.

"While we dispute the default notices, our tender offers will allow those bondholders who believe we are in default to redeem their holdings, ensuring that management is able to focus all of its attention on operations in this strong 2006 truck market."

"By tendering at no less than par, Navistar is meeting its full obligation to bond holders. In addition, the resulting capital structure will provide the company with the time necessary to complete its public filings and the flexibility to pursue future financings on the best terms available," added Bob Lannert, vice chairman and chief financial officer.

Navistar is offering $960.00 per $1,000 principal amount for the 6¼% and 7½% notes and $968.75 per $1,000 principal amount of the 9 3/8% notes.

For holders who tender by the consent deadline of 5 p.m. ET on March 2, the company will also make a consent payment equal to $40.00 per $1,000 multiplied by the amount of notes outstanding in the particular series of notes divided by the amount tendered by the consent deadline.

Navistar will also pay accrued interest up to but excluding the date of purchase.

Navistar is also soliciting consents to amend the notes to waive any and all defaults and events of defaults, eliminate substantially all of the material restrictive covenants, specified affirmative covenants and certain events of default and related provisions in the senior notes indentures and rescind any and all prior notices of default and/or acceleration delivered to Navistar.

Consents are needed from holders of a majority of each series of notes.

Holders may not tender without delivering consents.

The tenders end at 5 p.m. ET on March 20 unless extended.

Completion is subject to conditions include the receipt of proceeds from debt financings, Navistar not completing its audit for 2005 and the receipt of tenders for a majority of each series of notes.

Citigroup (800 558-3745 or 212 723-6106), Credit Suisse (800 820-1653 or 212 538-7969) and Banc of America Securities LLC are dealer managers. Global Bondholder Services Corp. is information agent (866 857-2200 or 212 430-3774).

Navistar is a Warrenville, Ill., a maker of trucks and engines.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.