Young Broadcasting to tender for senior and subordinated notes

Young Broadcasting Inc. (B2/BB-) said on Wednesday (Aug. 7) that it plans to begin offers to purchase for cash all $250 million of its outstanding 8½% senior notes due 2008 ; a minimum principal amount of $54.5 million and a maximum of $206 million of its $500 million of outstanding 10% senior subordinated notes due 2011; a minimum principal amount of $13.6 million and a maximum of $51.5 million of its $125 million of outstanding 9% senior subordinated notes due 2006; and a minimum principal amount of $21.8 million and a maximum of $82.4 million of its $200 million of outstanding 8¾% senior subordinated notes due 2007. Young said the tender offers for the notes would actually commence on Aug. 12.

Young said it plans to purchase the notes at par value, plus accrued and unpaid interest through the payment date. The offers will expire at 5 p.m. ET on Sept. 12, subject to possible extension. Young said it would fund the tender offers using the approximately $340 million of net proceeds from its previously announced sale of its KCAL-TV television station in Los Angeles, which was completed in May. The company said that the purpose of the tender offers is to make "excess proceeds offers" with the net proceeds resulting from the KCAL sale in under the terms of the notes' indentures.

The offer to purchase the three series of subordinated notes will be made concurrently with the offer to purchase the senior notes; however, under the terms of the indentures governing the various series of the notes, the holders of senior notes are entitled to have their notes purchased in full prior to any purchase of the subordinated notes. Accordingly, the amount of "net proceeds" which will be available to be paid to the holders of the subordinated notes will be equal to the amount of the net proceeds from the KCAL sale which are not used to purchase the senior notes. That amount will thus be available to purchase tendered subordinated notes on a proportionate basis, in accordance with the terms of the indentures governing those subordinated notes.

If Young Broadcasting chooses to terminate the tender offer for the senior notes prior to its scheduled expiration date, the tender offer for the subordinated notes will also be terminated, since no subordinated notes will be accepted for payment or purchased unless the senior note tender offer is consummated. If the senior note offer and the senior subordinated note offer are both completed and there remain any unused aggregate net proceeds of the KCAL-TV sale, Young reserves the right to use such remaining excess proceeds for general corporate purposes not otherwise prohibited by the indentures governing the notes. Wachovia Bank, National Association will be the depositary for the tender offers; Young Broadcasting itself will answer any questions regarding the offer (contact Chief Financial Officer James A. Morgan at 212 754-7070).

AS PREVIOUSLY ANNOUNCED, Young Broadcasting, a New York-based television station ownership group, said on May 14 that it intended to make an offer to the holders of its outstanding senior and subordinated notes to redeem those securities at par plus accrued interest. Young outlined its intentions as it announced its first-quarter earnings results. The company cautioned that it could not definitely predict whether the offer would be accepted by the note holders. Young said it planned to fund the note redemption from the proceeds of the previously announced $650 million sale of its Los Angeles television station, KCAL-TV, to Viacom Inc. Young said the Federal Communications Commission approved the transfer on May 4, and the company said it expected that the sale would be closed in a few days. Young said that assuming that all net proceeds from the TV station sale would be applied to reduce debt, the company's remaining outstanding borrowings would be approximately $610 million, all in the form of long-term notes. On May 15, Young announced that the KCAL-TV sale to Viacom had closed.

On June 25, Young announced the extension of its pending offer to exchange up to $250 million of newly issued 8½% senior notes due 2008 for a like amount of outstanding notes which had been sold to qualified institutional buyers under Rule 144A of the Securities Act on Dec. 7, 2001. While the existing notes were not registered for unlimited public trading, the replacement notes have been; terms of the notes are otherwise identical. Young - which did not publicly announce the beginning of the exchange offer, but which made it known to the noteholders via a prospectus - said that the offer, which was originally to have expired at 5 p.m. ET on June 24, was extended to 5 p.m. ET on June 27, subject to possible further extension. As of the previous deadline, approximately $249 million in of the outstanding notes had been confirmed as tendered in exchange for a like principal amount of the new exchange notes. Young made no subsequent public announcement as to the status of the exchange offer.

Ziff Davis Media again extends 12% '10 note exchange

Ziff Davis Media Inc. (CCC-) said on Wednesday (Aug 7) that it had again extended its previously announced offer to exchange a package of cash and new notes for its outstanding 12% senior subordinated notes due 2010, along with the related solicitation of noteholder consents to its proposed financial restructuring plan. The offer was extended to 5 p.m. ET on Aug. 9, subject to possible further extension, from the previous Aug. 6 deadline.

Ziff Davis also said that as of Aug. 1, holders of approximately 95.1% of the aggregate face amount of bonds had now formally accepted the exchange offer, up from the 92% reported previously, (thus satisfying the previously announced minimum condition for noteholder participation). It also said that it had reached agreement in principal with the holders of 100% of the outstanding loans under its senior credit facility regarding a previously announced proposed amended and restated credit agreement. Willis Stein & Partners III, LP and certain of its affiliates meantime agreed to purchase for $720,000 from a tendering bondholder certain equity securities of Ziff Davis Media's corporate parent, Ziff Davis Holdings Inc., that will be issued to that bondholder in the exchange offer. The Willis Stein purchase is contingent upon the completion of the exchange offer.

AS PREVIOUSLY ANNOUNCED, Ziff Davis Media, a New York-based publisher of technology-oriented magazines, said on May 1 that bondholders representing approximately 60% of its $250 million of 12% notes had agreed in principle to participate in a comprehensive financial restructuring, under which the company would offer the holders of the outstanding notes an aggregate of $30 million in cash, $95 million in new payment-in-kind senior subordinated notes issued by Ziff Davis Media, as well as both shares of a new preferred stock and warrants for the purchase of common stock of Ziff Davis Holdings, in exchange for their existing notes. Completion of the exchange offer would allow Ziff Davis to reduce its debt by approximately $155 million and its cash debt service requirements over the next several years by approximately $30 million annually. Ziff Davis also announced that in connection with such agreements, the controlling stockholder of Ziff Davis Holdings - Willis Stein & Partners III LP - and other existing stockholders had agreed in principle to make an equity cash infusion of $80 million, in exchange for new preferred stock and warrants for the purchase of common stock in Ziff Davis Holdings Inc. in order to facilitate the planned restructuring. Ziff Davis Media's existing bank credit agreement would meanwhile remain in place, with an amendment incorporating certain anticipated modifications to be negotiated with the bank lenders. Ziff Davis said that the obligations of all parties to participate in the financial restructuring would be subject to a number of conditions, including an amendment to the senior bank credit agreement, acceptances of the exchange offer for the notes by the holders of at least 95% of the existing senior notes, and finalization of documentation.

In connection with the exchange offer, Ziff Davis further said that it planned to solicit consents for a pre-packaged plan of reorganization which, if used, would result in the company's business operations continuing uninterrupted and with customers, trade creditors and employees being unaffected. The company said that following the negotiation of a comprehensive amendment to its bank credit agreement, it expected to begin to formally solicit bondholders within the next few weeks to tender their senior notes in the proposed exchange offer.

On June 17, Ziff Davis said that it had received consents from the holders of approximately 90% of the outstanding loans under its senior credit facility and had reached an agreement in principle with those holders regarding the proposed amendment to the existing credit agreement. It said that the proposed amendment provided for, among other things, the company's existing senior credit agreement to be amended and restated, subject to certain customary conditions, including the final approval by all of the lenders and the completed restructuring of the company's 12% notes. Ziff Davis further said that it had formally begun solicitation of votes in support of its financial restructuring plan from holders of the 12% notes and from the senior lenders. The company reiterated that it was on track to complete its financial restructuring by the end of the summer.

On July 16, Ziff Davis said that it had extended its previously announced offer to exchange a package of cash and new notes for the 12% notes, along with the related solicitation of noteholder consents to the proposed financial restructuring plan. The offer was extended to 9 a.m. on July 23, 2002, subject to possible further extension, with the holders of over 87% of the aggregate face amount of the bonds having formally accepted the exchange offer, while over 95% of bondholders and senior bank lenders who voted also consenting to the prepackaged plan which Ziff Davis might use to implement the restructuring. The company also said that the $15 million bond interest payment that came due on July 15 will be included as part of the total value of cash and new securities that will eventually be issued to the noteholders once the exchange offer or the pre-packaged plan of reorganization is completed. On July 23, Ziff Davis again extended the exchange offer and consent solicitation for the 12% bonds to 9 a.m. ET on July 30 and said that so far the holders of over 88% of the bonds had formally accepted the terms of the financial restructuring plan, with approximately 98% of these same note holders and approximately 96% of the company's voting senior bank lenders consenting to implement the same financial restructuring plan through the prepackaged plan of reorganization.

On July 31, Ziff Davis further extended the exchange offer to 9 a.m. ET on Aug. 1, from the previous July 30 deadline. So far, holders of approximately 88% of the aggregate face amount of bonds had now formally accepted the exchange offer, and over 98% of the same bondholders and 96% of the senior bank lenders who voted had also consented to the prepackaged plan. On Aug. 2., Ziff Davis again extended the exchange offer to 9 a.m. ET on Aug. 5, from the previous Aug. 1 deadline. Ziff Davis also said that so far, holders of approximately 91% of the outstanding bonds had accepted the exchange offer, up from 88% previously. There was no change in previous noteholder and bank consent levels for the pre-packaged plan. On Aug. 6, the company again announced that the offer would be extended, to 5 p.m. ET on Aug. 6 from the previous Aug. 5 deadline, and said that holders of 92% of the notes had now tendered them, up from 91% previously. There was no change in previous noteholder and bank consent levels for the pre-packaged plan.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.