Viterra accepts tenders for C$175.79 million 6.406% notes, plans to redeem remaining notes

By Jennifer Chiou

New York, May 27 - Viterra Inc. announced that it has accepted for purchase C$175,793,000 principal amount of its C$200 million of 6.406% senior notes due 2021. In addition, the previously executed supplemental indenture is now operative.

The company said earlier in the month that it received requisite approval from holders of the notes to make some proposed extraordinary amendments and some special amendments to the indenture governing the notes.

According to a company news release, noteholders voted at a meeting at 10 a.m. ET on May 23 in Toronto.

Viterra said it intends to redeem all notes that remain outstanding following the expiration of the offer at a redemption price of C$1,110 per C$1,000 principal amount plus accrued interest.

As reported, the total purchase price in the tender offer will be C$1,140 for each C$1,000 principal amount of notes tendered by 10 a.m. ET on May 21, the consent date. The total amount includes a C$30.00 consent payment for each C$1,000 of notes.

Holders had to tender their notes and deliver consents by the early tender date in order to receive the total amount.

The company also will pay accrued interest.

The tender offer will end at 5 p.m. ET on June 5. Holders must be of record as of May 2.

Indenture amendments

As noted, the extraordinary amendments will align the reporting requirements under the note indenture with Glencore Xstrata plc's public reporting requirements, remove the application of positive covenants and events of default with regard to restricted subsidiaries of Viterra and eliminate some restrictions on related party transactions.

The amendments also amend the indenture to provide a guarantee by each of Glencore and its main operating subsidiaries, Glencore International AG and Glencore (Schweiz) AG, and to add a corresponding negative pledge to the indenture restricting each of the parent guarantors and their respective material subsidiaries from pledging their properties or assets as security for present or future debt and make consequential amendments including expanding events of default relating to indenture covenant non-compliance, cross-acceleration on other debt, liquidation or wind-up and bankruptcy or insolvency events so that they apply to each of the parent guarantors as well as to Viterra.

The special amendments will, among other things, give Viterra the right to redeem the notes for cash at a price equal to the tender offer payment plus accrued interest.

If Viterra obtains the relief being sought under a relief application to the Financial and Consumer Affairs Authority of Saskatchewan and the Ontario Securities Commission, the amendments will allow Viterra to satisfy its Canadian public disclosure requirements by filing on the System for Electronic Document Analysis and Retrieval Glencore's consolidated financial statements, among other of Glencore's U.K. public disclosure requirements, rather than Viterra's consolidated financial statements.

In order for the extraordinary amendments to pass, the company needed to obtain consents from holders of at least two-thirds of the notes or the resolution needed to be passed by the holders of notes representing at least two-thirds of the votes cast at the noteholder meeting.

For the special amendments, the company needed consents from holders of at least 95% of the notes or at least 95% of the votes cast at the meeting.

Tender details

Viterra already said at the beginning of the offer that it entered into a support and voting agreement with an arm's length noteholder who holds C$28.05 million, or 14%, of the outstanding notes. The locked-up noteholder agreed to tender notes under the offer and vote in favor of the amendments.

In addition, other arm's length noteholders who hold about C$55.7 million, or 27.8%, of the outstanding notes agreed to tender their notes and vote for the resolutions.

The supporting noteholders, however, did not entered into a binding agreement with the company.

CIBC World Markets Inc. (416 956-6171) is the dealer manager and solicitation agent. The information agent is CST Phoenix Advisors (800 761-6578, or outside North America, 201 806-2222, e-mail inquiries@phoenixadvisorscst.com). The depositary and tabulation agent is CST Trust Co. (800 387-0825 or 416 682-3860).

Viterra is a Calgary, Alta.-based agribusiness company.

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