American Greetings scraps tender, consent bid; control offer still on

By Susanna Moon

Chicago, March 21 – American Greetings Corp. said it is terminating the tender offer and consent solicitation for its $400 million of 7 7/8% senior notes due 2025.

The change-of-control offer required under the indenture remains open, according to a company notice on Wednesday.

No other details were included in the release.

The company began tendering for the notes on March 8 at a total purchase price of 101.25% of par, which included a consent payment of 0.25% for notes tendered by the consent payment deadline of 5 p.m. ET on March 20.

The tender offer was set to end at midnight ET on April 4.

American Greetings also was soliciting consents to eliminate substantially all of the restrictive covenants, some events of default and other related provisions.

The offer had a financing condition. The tender also was conditioned upon CD&R AG Holdings, LP acquiring at least 60% of the direct or indirect outstanding equity of the company.

The proposed merger is with affiliates of Clayton, Dubilier & Rice, LLC.

D.F. King & Co., Inc. (212 269-5550, 800 676-7437 or agc@dfking.com) is the information and tender agent. Deutsche Bank Securities Inc., at (212 250-7527 or 855 287-1922) is the solicitation agent.

The issuer said on March 7 that it was extending the consent solicitation for its 7 7/8% senior notes due 2025 until 5 p.m. ET on March 9, extended from 5 p.m. ET on March 6.

The consent solicitation opened on Feb. 20 and was initially set to expire at 5 p.m. ET on Feb. 27.

Then the company said on March 8 that it was increasing the consent fee to $20 per $1,000 principal amount from $2.50 per $1,000 principal amount and extended the solicitation until 5 p.m. ET on March 12. The deadline was previously extended to 5 p.m. ET on March 9 from 5 p.m. ET on March 6 and, before that, from 5 p.m. ET on Feb. 27.

The company was asking holders to consent to amendments to the note indenture so that the acquisition of no less than 60% of the direct or indirect outstanding equity of the company by Clayton, Dubilier & Rice, LLC or any affiliate would not constitute a change of control and no change-of-control offer would be required in connection with the acquisition.

The company will make the cash payment concurrently with closing of the acquisition.

American Greetings is a Cleveland-based greeting card company.

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