Westlake Chemical wraps exchange offer for two series of Axiall notes

By Susanna Moon

Chicago, Sept. 6 – Westlake Chemical Corp. announced the results of the exchange offer for two series of notes related to its planned acquisition of Axiall Corp.

As announced Aug. 8, the company was offering to issue new notes with the same coupon and maturity in exchange for any and all of the two note series.

Investors had tendered for exchange the following amount of notes by the end of the exchange at 11:59 p.m. ET on Sept. 2, according to a company announcement:

• $624,793,000, or 90.81%, of the $688 million of outstanding 4.625% senior notes due Feb. 15, 2021 issued by Eagle Spinco Inc., a wholly owned subsidiary of Axiall; and

• $433,793,000, or 96.4%, of the $450 million of outstanding 4.875% senior notes due May 15, 2023 issued by Axiall.

The total exchange amount will be par of $1,000 principal amount of notes plus $2.50 cash, which includes an early tender premium of $30.00 of new notes per $1,000 of notes.

Investors had tendered for exchange as of 5 p.m. ET on Aug. 19, the early participation date, $624,487,000, or 90.77%, of the 4.625% notes and $433,614,000, or 96.36%, of the 4.875% notes.

Axiall received the needed consents to amend the notes by the early deadline, and the proposed amendments will become operative when the early tendered notes are purchased on Sept. 7, the company previously said.

Westlake also extended the deadline for receiving the total exchange value until the end of the offer.

Before the change, those who tendered after the early deadline would have received the total exchange value less the early premium.

Westlake said it plans to issue the new Westlake notes “promptly” on or about the second business day after the offer ends.

Along with the tender, Axiall was soliciting consents to amend the notes to eliminate some covenants, restrictive provisions and events of default.

Even if the holders of at least a majority of the notes did not consent to the proposed amendments, the existing Axiall indentures include provisions automatically terminating many of the restrictive covenants upon the receipt of an investment-grade rating from both Moody’s Investors Service and S&P, the company previously noted.

Holders who tendered their notes were deemed to consent to the proposed amendments, and they could not give consents without tendering their notes.

The offers were open to holders who are qualified institutional buyers under Rule 144A and Regulation S.

Global Bondholder Services Corp. (866 924-2200, 212 430-3774 or gbsc-usa.com/eligibility/Westlake) is the exchange agent and information agent.

The conditions to the offer included closing of the proposed merger between Axiall, Westlake and Lagoon Merger Sub, Inc., a wholly owned subsidiary of Westlake, with Axiall surviving as a wholly owned subsidiary of Westlake, the completion of financing and the establishment of a credit facility as well as the receipt of consents for at least a majority of the outstanding principal amount of each series of Axiall notes.

Westlake Chemical said on Aug. 24 that it closed a new five-year $1 billion unsecured revolving credit agreement.

The merger was not subject to a financing condition or completion of the exchange.

Westlake is a manufacturer and supplier of petrochemicals, polymers and building products and is based in Houston.

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