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Level 3 begins tender offers for 2.875%, 6% convertibles
By Angela McDaniels
Tacoma, Wash., Nov. 17 - Level 3 Communications, Inc. said it began three separate tender offers for its $354.54 million outstanding 2.875% convertible senior notes due 2010, $481.67 million outstanding 6% convertible subordinated notes due 2010 and $305.14 million outstanding 6% convertible subordinated notes due 2009.
For each $1,000 principal amount, the company is offering $620 for the 2.875% convertibles, $700 for the 6% convertibles due 2010 and $920 for the 6% convertibles due 2009.
Holders will also receive accrued interest up to but excluding the payment date.
The offers will expire at midnight ET on Dec. 15, according to a company news release.
The offers each have a minimum tender condition, which is $177.27 million for the 2.875% convertibles, $240.83 million for the 6% convertibles due 2010 and $152.57 million for the 6% convertibles due 2009.
The offer for the 2.875% convertibles is conditioned on the acceptance by the company of its 6% convertibles due 2010 and vice versa. The offer for the 6% convertibles due 2009 is conditioned on the acceptance by the company of both its 2.875% convertibles and 6% convertibles due 2010.
The company plans to fund the offers with the proceeds from the sale of newly issued 15% convertible senior notes due 2013 and from cash on hand. Level 3 said investors are not obligated to purchase the new convertibles if Level 3 does not accept for purchase at least 50% of the 2.875% convertibles and at least 50% of the 6% convertibles due 2010.
In turn, the tender offers are conditioned on the sale of at least $373 million of new convertibles.
Citi (800 558-3745 or 212 723-6106) and Merrill Lynch & Co. (888 654-8637 or 212 449-4914) are the dealer managers, and Global Bondholder Services Corp. (212 430-3774 or 866 873-6300) is the information agent.
Level 3 a Broomfield, Colo.-based provider of fiber-based communications services.
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