HP pushes out exchange offer for Plantronics notes to Aug. 15

By Wendy Van Sickle

Columbus, Ohio, Aug. 1 – HP Inc. has further extended the deadline for its exchange offer and consent solicitation for any and all of the $500 million outstanding 4¾% senior notes due March 1, 2029 (Cusips: 727493AC2, U7260PAB7) issued by Plantronics Inc., according to a press release Monday.

The offer will now expire at 11:59 p.m. ET on Aug. 15, pushed out from 11:59 p.m. ET on Aug. 1.

The offer was extended from 11:59 p.m. ET on July 28, which was extended from the original deadline of 11:59 p.m. ET on July 25.

The early participation deadline has been now extended to 5 p.m. ET on July 18. It was previously set to expire at 5 p.m. ET on July 14, which was extended from the original deadline of 5 p.m. ET on July 11.

By 5 p.m. ET on July 18, tenders had been received for $490,506,000 principal amount of notes, as previously reported. That was enough for approval of a concurrent consent solicitation, and the company executed the related supplemental indenture on July 25, according to Monday’s update. It will become operative upon settlement of the exchange offer.

The early participation premium was previously extended to the remaining noteholders until 11:59 p.m. ET on Aug. 1. By that date, the total amount of tenders received had risen slightly to $490,556,000.

As previously reported, the aggregate consent payment to all consenting noteholders will be $8 million, to be shared by all such consenting holders.

Specifically, the consent payment will be an amount, per $1,000 of Poly notes, for which holders have validly delivered and not withdrawn consents by the early participation deadline, equal to the product of $16 multiplied by a fraction, the numerator of which is the total amount of Poly notes outstanding as of the early participation date and the denominator of which is the total amount of Poly notes for which holders have delivered consents by the early participation date.

As a result, the consent payment will range from $16 per $1,000 of Poly notes, if all holders consent, to approximately $32 per $1,000 of Poly notes, if holders of a simple majority of the total amount of the Poly notes consent.

The cash consent payment was originally $2.50 per $1,000 of notes.

As previously reported on June 27, for each $1,000 Poly note, HP is offering $1,000 principal amount of notes issued by HP with a 4¾% coupon and a 2029 maturity date. The consideration includes $30 of new notes that will not be paid to holders who tender their notes after the early participation deadline.

No interest will be paid in the exchange offer.

The interest rate, interest payment dates, maturity and redemption date are the same in the new HP notes and the old Poly notes. The first interest payment on the HP notes will include the accrued interest from the old Poly notes.

The exchange offer is in connection with a previous announcement that HP will be acquiring Poly in an all-cash transaction for $40 per share for an implied total enterprise value of $3.3 billion, inclusive of Poly’s net debt.

HP also concurrently solicited consents to adopt some proposed amendments to the indenture governing the existing Poly notes to eliminate: substantially all of the restrictive covenants; some of the events which may lead to an event of default; restrictions on Poly consolidating with or merging into another person or conveying, transferring or leasing all or any of its properties and assets to any person; the reporting covenant; and the change-of-control put.

As noted, the necessary consents were received.

The offer is conditioned on the successful closing of the acquisition.

Settlement of the exchange offer will occur promptly after the expiration date and is expected to occur no earlier than the closing of the acquisition, expected by the end of 2022.

The exchange offer is only open to persons in Canada that are located or resident in the provinces of Alberta, British Columbia, Ontario and Quebec.

Eligible Canadian persons will need to complete a Canadian eligibility certificate if they plan on tendering their notes.

Persons located in or residents of other provinces may not participate.

D.F. King & Co., Inc. is the exchange agent and information agent for the offer (888 605-1956, 212 269-5550, hp@dfking.com, www.dfking.com/hp).

Dealer managers for the exchange offer and the solicitation agents for the consent solicitation are Goldman Sachs & Co. LLC (212 357-1452, 800 828-3182) and Wells Fargo Securities, LLC (866 309-6316, 704 410-4756, liabilitymanagement@wellsfargo.com).

Plantronics is a Santa Cruz, Calif.-based electronics company. HP is a Palo Alto technology company.

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