Avanza Spain starts tender offer for 7½%, 9½% notes issued by AG Spring

By Toni Weeks

San Luis Obispo, Calif., March 19 – Avanza Spain SAU announced the start of cash tender offers and consent solicitations for any and all of the outstanding €315 million principal amount of 7½% senior secured notes due 2018 issued by AG Spring Finance Ltd. and any and all of the outstanding €175 million principal amount of 9½% senior notes due 2019 issued by AG Spring Finance II Ltd.

Holders who tender their notes and provide consents by 5 p.m. ET on April 1, the early tender and consent date, will receive the total consideration, which is €1,032.50 for the 7½% notes and €950.00 for the 9½% notes, in each case per €1,000 principal amount of notes. The payment includes an early tender premium of €30.00 per €1,000 of notes.

Holders who tender their notes after the early tender and consent date but on or prior to the expiration date will not receive the early tender premium.

The offers will expire at 11:59 p.m. ET on April 15.

The issuer will also pay accrued interest to, but not including, the settlement date, which, for notes tendered by the early tender and consent date, will be the day after the early deadline.

The company is also seeking consents from noteholders to amend the indentures governing each note series. The exact amendments were not disclosed in the notice.

The company needs consents from holders representing at least a majority in principal amount of each of the series of notes to amend the indentures. To execute the release of the collateral securing the senior secured loan or the release of the loan guarantees for the 7½% notes or the release of the loan guarantees for the 9½% notes, the company needs the approval of holders representing 90% or more of the applicable series of notes.

The offer is subject to the receipt of proceeds from a new loan in a principal amount sufficient to fund the settlement of the tender offers and consent solicitations and redemption of the notes, if required. The new loan is expected to have a shorter maturity than the outstanding notes.

Credit Suisse Securities (Europe) Ltd. (212 538-2147 collect or 800 820-1653 in the United States or 44 207 883 8763 outside the U.S. or liability.management@credit-suisse.com) is the dealer manager. The tender and tabulation agent is Lucid Issuer Services Ltd. (44 20 7704-0880 or avanzagrupo@lucid-is.com).

Related redemptions

Avanza also announced that AG Spring has issued a notice of redemption to redeem up to 10%, or €31.5 million, of the outstanding principal amount of the 7½% senior secured notes on a pro rata basis.

The notes will be redeemed at a redemption price of 103 plus a total of €912,187.50 of accrued interest, for a total redemption consideration of €33,357,187.50.

The redemption date will be April 20, and the record date is April 17.

U.S. Bank Trustees Ltd. is the trustee. Elavon Financial Services Ltd., UK Branch is the principal paying agent.

The redemption is conditional upon obtaining financing and the consummation of the tender offers.

Madrid-based Avanza Spain is a provider of bus transportation services in Spain and of mass transit bus transportation services in Spain and Portugal.

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