Wesco further extends tender offer for Anixter notes due 2023, 2025

By Marisa Wong

Los Angeles, June 16 – Wesco International, Inc. said wholly owned subsidiary Wesco Distribution, Inc. has extended the expiration time of its offers to purchase for cash any and all of Anixter Inc.’s outstanding $350 million 5½% senior notes due 2023 (Cusip: 035287AG6) and $250 million 6% senior notes due 2025 (Cusip: 035287AJ0).

The expiration date was extended to 11:59 p.m. ET on June 22 from 11:59 p.m. ET on June 15. The deadline had previously been pushed back from 11:59 p.m. ET on May 28.

Wesco is conducting the offers in connection with its acquisition of Anixter International Inc., as announced on April 30.

Because the offers are conditioned on closing of the merger, Wesco intends to further extend the expiration time as necessary, without extending the withdrawal deadline, to have the payment date of the tender offers coincide with the closing of the merger.

The transaction is expected to be completed in the second or third calendar quarter of 2020. However, the merger agreement provides for the outside date to be automatically extended to as late as Jan. 11, 2021 under certain circumstances, and the parties could mutually agree to extend the outside date beyond that date.

As a result, any holder who tenders notes may not receive payment of the applicable offer consideration and may be unable to withdraw or trade its notes for a substantial duration.

As of 5 p.m. ET on June 15, holders had tendered $291,356,000, or 83.24%, of the 2023 notes and $245,827,000, or 98.33%, of the 2025 notes, unchanged from the amounts tendered as of 5 p.m. ET on May 13, the consent solicitation deadline.

As previously announced, Wesco is soliciting consents with respect to each series of notes to amend the applicable indenture governing the notes to eliminate substantially all of the restrictive covenants, eliminate some events of default and eliminate any requirement to make a change-of-control offer.

Because holders of a majority of the aggregate principal amount outstanding of each series of notes tendered their notes and are considered to have delivered their related consents, Wesco received the consents required to amend the notes.

According to a previous press release, Anixter and Anixter International entered into a supplemental indenture effecting the changes proposed under the Wesco consent solicitation.

Concurrently, Anixter solicited consents with respect to the indenture for each series of notes to amend the definition of change of control to exclude the merger with Wesco and related transactions and to expressly permit a merger between parent company Anixter International and Anixter in which Anixter survives.

With respect to notes of any series, a holder may participate in either the offer made by Wesco, in which case that holder would be delivering consents under Wesco’s consent solicitation, or the consent solicitation made by Anixter, but not both.

As of the consent solicitation deadline, holders had delivered consents under the Anixter solicitation for $55,538,000, or 15.87%, of the 2023 notes and $556,000, or 0.22%, of the 2025 notes.

Since the supplement indentures have been executed according to the Wesco consent solicitation, Anixter will not enter into a supplemental indenture giving effect to the proposed changes under its own consent solicitation.

However, holders who delivered consents under the Anixter consent solicitation will receive the consent solicitation payment of $2.50 per $1,000 principal amount.

Wesco offer details

Tenders may no longer be withdrawn.

Holders whose notes were tendered at or prior to the early tender deadline, 5 p.m. ET on May 13, and accepted for purchase will be eligible to receive the total consideration of $1,012.50 per $1,000 principal amount of notes. The total consideration includes an early tender payment of $50.00 per $1,000 of notes accepted for purchase.

Holders tendering after the early tender deadline will only be eligible to receive the tender consideration of $962.50 per $1,000 principal amount.

Wesco will also pay accrued interest to but excluding the settlement date of the offers.

Anixter solicitation

The Anixter consent solicitations have not expired, and consents may no longer be revoked.

Approval of Anixter’s change-of-control proposed amendments with respect to a series of notes required consents from holders of a majority of the aggregate principal amount outstanding of that series.

If that condition had been satisfied for a series of notes, Anixter would have entered into a supplemental indenture effecting the proposed change-of-control amendments.

Among other things, payment of the consent solicitation fee is conditioned on the merger being completed at or prior to the later of 5 p.m. ET on April 1, 2021 or the outside date.

Holders who receive the consent solicitation payment will not be entitled to any accrued interest, Wesco noted.

Barclays (212 528-7581 or 800 438-3242) is the dealer manager and solicitation agent for the offers and Anixter consent solicitations.

D.F. King & Co., Inc. (212 269-5550 for brokers and banks or 877 361-7966 for all others, anixter@dfking.com) is the tender agent and information agent.

Wesco is a Pittsburgh-based provider of electrical, industrial and communications maintenance, repair and operating (MRO) and original equipment manufacturer (OEM) products, construction materials and advanced supply chain management and logistic services.

Anixter is a Glenview, Ill.-based company that supplies communications and security products.

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