Charter wraps tender offers for three note series, calls 10 7/8% notes

By Susanna Moon

Chicago, Feb. 16 - Charter Communications, Inc. subsidiaries Charter Communications Operating, LLC and CCH II, LLC wrapped their tender offers to buy up to $1.01 billion of three series of notes, accepting all of the notes tendered by the expiration date.

Charter Communications Operations said it received and accepted tenders from holders of $300 million, or 59.87%, of its $500,341,000 of 8% senior second-lien notes due 2012 and $294 million, or 94.25%, of its $311,561,000 of 10 7/8% senior second-lien notes due 2014.

CCH II obtained tenders from holders of $334 million, or 22.56%, of its $1,480,367,024 of outstanding 13½% senior notes due 2016.

Those amounts remain unchanged from Feb. 1, when the companies extended their tender offers, increased the amount of notes they could buy and waived a sub-limit. No further notes from those series had been tendered as of Feb. 1.

The tender offers expired at 11:59 p.m. ET on Feb. 14. The offers were pushed back from 11:59 p.m. ET on Feb. 8. They began on Jan. 11.

Charter raised the maximum purchase price to $1.01 billion from $843 million previously. It also waived the sublimit of $250 million for CCH II's 13½% senior notes due 2016.

The Charter Operations' notes had priority over the CCH II notes, which had a purchase cap of $250 million. That cap was removed.

As previously noted, Charter Operating was also seeking consents from a majority of the holders of the 8% notes and 10 7/8% notes to remove the covenants under the notes, and it received the necessary consents.

For each $1,000 principal amount, the total price is $1,019.40 for the 8% notes, $1,068.35 for the 10 7/8% notes and $1,155.00 for the 13½% notes tendered by the early deadline at 5 p.m. ET on Jan. 25. The total price includes an early tender premium of $25.00 per $1,000 of notes.

Holders who tendered after the early date will not receive the early tender premium.

The offers were conditioned on financing. CCO Holdings, LLC and CCO Holdings Capital Corp. plan to publicly offer $750 million principal amount of senior notes due 2022 to help fund the offers, along with drawdowns under Charter's revolving credit facility.

Charter also said it plans to redeem the remaining $18 million of Charter Operating's 10 7/8% notes on March 15 at 105.438% of par plus accrued interest up to the redemption date.

Credit Suisse Securities (USA) LLC (800 820-1653 or collect 212 325-5912), Citigroup Global Markets Inc. (800 558-3745 or collect 212 723-6106) and UBS Securities LLC (888 719-4210) are the dealer managers for the tender offer. Global Bondholder Services Corp. (866 389-1500 or collect 212 430-3774) was the information agent.

Charter is a St. Louis-based cable operator and broadband communications company.

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