Central European Media gets needed consents for subsidiary's 9% notes

By Jennifer Chiou

New York, March 12 - Central European Media Enterprises Ltd. announced the receipt of the required consents in its Czech subsidiary's solicitation for its 9% senior secured notes due 2017.

CET 21 obtained consents from holders of a majority of the notes and executed a supplemental indenture. The changes allow debt to be incurred under the company's refinancing plans.

As previously reported, the company was seeking consents to enhance the liquidity and operating cash flow of Central European Media and its restricted subsidiaries, including CET 21, by substituting cash pay debt with non-cash pay debt.

The consent solicitation ended at 5 p.m. ET on March 11. The consent fee is €2.50 in cash per €1,000 principal amount of notes.

Note redemption

At the end of February, the company announced plans to redeem its €272,972,000 principal amount of 11 5/8% senior notes due 2016 with proceeds of a rights offering.

In connection with the rights offering, holders of class A common stock and preferred stock will receive rights to purchase an aggregate of 3,391,403 units at a subscription price of $100.00 per unit.

Each unit will consist of a 15% senior secured note due 2017 at par of $100.00 and 21.167376 unit warrants exercisable at $1.00 per share.

Time Warner has agreed to purchase all units in the rights offering not subscribed for by other shareholders, the company noted. In addition, Time Warner will purchase 576,968 units in a separate private placement to close with the rights offering.

Proceeds of the rights offering and the purchase of units by Time Warner will be about $396.8 million, which is equal to the amount of principal and early redemption premium payable to redeem the 2016 notes, according to a company press release.

Citigroup Global Markets Inc. (212 723-6106 or 44 0 20 7986 8969) was the solicitation agent for the consent solicitation. Global Bondholder Services Corp. (212 430-3774) was the information agent.

The company provides programming in Eastern European countries, including the Czech Republic, Bulgaria, Romania, Slovakia, Slovenia and Croatia.

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