Avis Budget begins tender offers for $450 million of 9 5/8%, 9¾% notes

By Susanna Moon

Chicago, March 19 - Avis Budget Group, Inc. said its wholly owned subsidiaries Avis Budget Car Rental, LLC and Avis Budget Finance, Inc. began a cash tender offer for their outstanding $450 million principal amount of 9 5/8% senior notes due 2018.

The issuers also are tendering for their $250 million of outstanding 9¾% senior notes due 2020 under a modified Dutch auction.

The company will spend a total of $450 million in the offers.

The tender offers will end at 11:59 p.m. ET on April 16 and will be funded primarily with the proceeds of a concurrent offering of $450 million of senior notes due 2023.

For each $1,000 principal amount, the total purchase price will be $1,127.50 for the 9 5/8% notes and between $1,165.00 and $1,190.00 for the 9¾% notes.

The total purchase prices include a $30.00 early tender premium per $1,000 of notes tendered by 5 p.m. ET on April 2, the early tender deadline.

Holders who tender after the early deadline will receive the total purchase price less the early premium.

The company also will pay accrued interest up to but excluding the settlement date.

Pricing for the 9¾% notes will be set based on a modified Dutch auction, and the total purchase price for the notes will equal $450 million minus the amount paid for the 9 5/8% notes, according to a company press release.

The bid price for tendered 9¾% notes represents the minimum price a holder is willing to receive for those notes and must fall within the bid price range and be in increments of $1.25.

If the offer for the 9¾% notes is oversubscribed, the issuers will purchase the notes on a prorated basis.

Tendered notes may withdrawn until the early deadline.

The offers are conditioned on the issuers receiving at least $450 million of proceeds from their proposed notes offering.

Barclays (800 438-3242 or collect 212 528-7581) is the dealer manager. D.F. King & Co., Inc. (800 967-4617 or banks and brokers 212 269-5550) is the information agent and tender agent.

The car rental company is based in Parsippany, N.J.

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