FTD launches tender for 7¾% notes

By Jennifer Chiou

New York, July 28 - FTD Group, Inc. announced that its wholly owned subsidiary, FTD, Inc., began a cash tender offer for any and all of its $170.12 million of 7¾% senior subordinated notes due 2014.

The company said it is also soliciting consents to effect certain amendments and waivers to the indenture governing the notes.

The offer and solicitation are being conducted in connection with the pending acquisition of FTD Group by United Online, Inc.

The tender offer ends at 5 p.m. ET on Aug. 25. The consent deadline is 5 p.m. ET on Aug. 11.

For each $1,000 principal amount, FTD said it will pay the present value of the notes to Feb. 15, 2009, the first call date of the notes, discounted using the 4.5% Treasury due Feb. 15, 2009 and 50 basis points, minus accrued interest.

Those who tender by the early deadline will receive the consent payment of $20.00 per $1,000 principal amount.

FTD added that it will also pay accrued interest.

The company previously announced that it will hold a special meeting of stockholders on Aug. 25 to consider United Online's buyout proposal, which has already been approved by FTD's board of directors.

As already noted, United Online is offering FTD shareholders $10.15 per share in cash and 0.4087 of a share of United Online common stock, for a total value of $14.38 per share of FTD common stock. The total payout to shareholders would be about $434 million.

The offer is expected to be funded with United Online cash on hand and/or borrowings under certain financings expected to be available prior to or concurrently with the closing of the acquisition of FTD.

The company is seeking tenders from holders of a majority of notes.

J.P. Morgan Securities Inc. (866 834-4666) is the dealer manager and solicitation agent, and Mackenzie Partners, Inc. (800 322-2885) is the information agent.

FTD, a worldwide provider of floral products, would operate as a wholly owned subsidiary of United Online from its existing facilities in Downers Grove, Ill., and the United Kingdom.

United Online is a Woodland Hills, Calif.-based provider of consumer internet and media services. Its services include Classmates, MyPoints, NetZero and Juno e-mail.

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