NXP noteholders show little enthusiasm for discounted private exchange offers at early deadline

By Angela McDaniels

Tacoma, Wash., March 24 - NXP BV had received tenders for about 10% of its notes by the early tender date in its two private offers to exchange five series of notes for new 10% super-priority notes due 2013 denominated in dollars or euros, according to a company news release.

The early tender date was 5 p.m. ET on March 23, pushed back from March 16. The offers will expire at midnight ET on March 30.

Notes eligible for exchange are the company's $1.25 billion 9½% senior notes due 2015, €525 million 8 5/8% senior notes due 2015, €1 billion floating-rate senior secured notes due 2013, $1.54 billion floating-rate senior secured notes due 2013 and $1.03 billion 7 7/8% senior secured notes due 2014.

As of March 23, investors tendered $244 million of the 9½% notes, €67 million of the 8 5/8% notes, €64 million of the euro-denominated floaters, $154 million of the dollar-denominated floaters and $22 million of the 7 7/8 notes.

The figures are up slightly from March 16, when investors had tendered $239 million of the 9½% notes, €58 million of the 8 5/8% notes, €57 million of the euro-denominated floaters, $109 million of the dollar-denominated floaters and $19 million of the 7 7/8 notes.

One exchange offer is for the 9½% notes and 8 5/8% notes, which each have an acceptance priority of one, and the other offer is for the remaining notes, which each have an acceptance priority of two.

In the first exchange offer, the company is offering $170 per $1,000 principal amount of 9½% notes and €170 per €1,000 principal amount of 8 5/8% notes. The payout includes a fee of €20 or $20 for each note tendered by the original early tender date, March 16.

In the second exchange offer, the company is offering €270 or $270 per floating-rate note and $320 for each 7 7/8% note. The payout includes a fee of €20 or $20 for each note tendered by the extended early tender date, March 23.

Holders will also receive accrued interest up to but excluding the settlement date.

New notes

The new super-priority notes will be issued by NXP and NXP Funding LLC, will be guaranteed by some of the company's current and future material wholly owned subsidiaries and will be secured on an equal basis with all secured debt outstanding under the issuers' senior revolving credit facility.

The company said it will apply to list the new notes on the Irish Stock Exchange.

The new dollar-denominated notes will be issued in minimum denominations of $75,000, and the new euro-denominated notes will be issued in minimum denominations of €50,000. As a result, holders will be unable to participate in the exchange offers if their ownership of existing notes is not great enough to meet these minimum requirements.

The total principal amount of new notes that the company is offering to exchange will be capped at €250 million, or the dollar equivalent as of one business day after the expiration date. NXP said it reserves the right to increase or decrease the cap.

The purpose of the exchange offers is to reduce the company's overall debt and related interest expense.

The exchange offers are being made within the United States only to qualified institutional buyers under Rule 144A of the Securities Act and to holders who are not U.S. persons as defined under Regulation S of the Securities Act.

Mackenzie Partners Inc. (Attn: Glen Linde or Jeanne Carr at 800 322-2885 or call collect 212 929-5500) is the information agent.

NXP is a semiconductor company based in Eindhoven, the Netherlands.

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