Meritor settles early tenders for $166 million 8 1/8% notes due 2015

By Susanna Moon

Chicago, May 31 - Meritor, Inc. said it accepted for purchase all $166,141,000 of 8 1/8% notes due 2015 tendered by 5 p.m. ET on May 23.

The amount tendered is 66.18% of the outstanding notes.

The company paid $192 million to purchase notes tendered through the early tender date, including accrued interest up to but excluding May 31, according to a press release.

Meritor funded the early settlement with some proceeds from its $275 million offering of notes completed on May 31, the release noted.

As noted on May 20, Meritor extended the early tender time in the offer for its $251,037,000 of outstanding 8 1/8% notes due 2015.

Holders could tender notes until 5 p.m. ET on May 23 to receive the total purchase price, pushed out from 5 p.m. ET on May 17, but tendered notes could no longer be withdrawn.

As of 5 p.m. ET on May 17, the company had received tenders for $165,218,000 principal amount, or 65.8%, of the outstanding principal amount of notes.

Based on the consents received, Meritor planned to execute a supplemental indenture to amend the notes to eliminate substantially all of the restrictive covenants and events of default. The supplemental indenture became operative when Meritor settled the early tendered notes.

The tender offer will continue until 12:01 a.m. ET on June 5. The offer began May 8.

As noted before, the total purchase price is $1,140 for each $1,000 principal amount of notes tendered by the early date, which includes a consent payment of $30 per $1,000 of notes.

Those who tender their notes after the early deadline will receive $1,110 per $1,000 of notes.

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

Tendered notes may no longer be withdrawn.

Holders who tender their notes will be deemed to have delivered consents, and holders may not tender notes without delivering consents.

The offer is conditioned on Meritor receiving enough proceeds from a debt financing to fund the offer, which has now been satisfied. It is not conditioned on a minimum amount of notes being tendered.

Citigroup Global Markets Inc. (800 558-3745 or 212 723-6106) is the dealer manager and solicitation agent. Global Bondholder Services Corp. (866 937-2200 or collect 212 430-3774) is the depositary and the information agent.

Meritor is a Troy, Mich.-based auto components maker.

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