Wesco settles oversubscribed tender for 1.75%, 2.625% convertibles

By Jennifer Chiou

New York, Aug. 27 - Wesco International, Inc. announced that it settled its tender offer in which it had received tenders for $299.7 million principal amount of its $300 million of 1.75% convertible senior debentures due 2026 and $129 million principal amount, or 86%, of its 2.625% convertible senior debentures due 2025.

The company said it accepted all of the 1.75% debentures and about $57.7 million of the 2.625% debentures, resulting in a proration factor of 44.7%.

The offer for the convertibles expired at midnight ET on Aug. 21. It began on July 27.

Wesco said it issued $345 million principal amount of its new 6% convertible senior debentures due 2029 in exchange for the tendered debentures.

Holders also receive accrued interest of $3.1 million in cash.

The company noted on Aug. 21 that the initial conversion price for its new 6% convertibles will be $28.8656, which is 125% of the average volume-weighted average price of the company's stock for the 10 trading days that ended Aug. 21.

The conversion ratio is 34.6433 shares per $1,000 principal amount of debentures.

The company issued $960 principal amount of new convertibles for each $1,000 principal amount of 1.75% convertibles and $1,010 principal amount of new convertibles for each $1,000 principal amount of 2.625% convertibles.

Wesco previously had said it would issue no more than $345 million principal amount of the new convertibles, and the offer was conditioned on the issue of at least $100 million of the 6% convertibles.

All tendered 1.75% convertibles were accepted before any 2.625% convertibles were accepted.

The lead dealer managers for the offer were Goldman, Sachs & Co. (877 686-5059 or call collect 212 357-2992) and Barclays Capital Inc. (800 438-3242 or call collect 212 528-7581). The co-dealer managers were Credit Suisse Securities (USA) LLC, Wells Fargo Securities, LLC, Robert W. Baird & Co. Inc. and Raymond James & Associates, Inc.

Global Bondholder Services Corp. (866 470-1500 or call collect 212 430-3774) was the information agent. The Bank of New York Mellon was the exchange agent.

Wesco is a Pittsburgh-based distributor of electrical construction products and supplies.

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