ADT begins offers to purchase up to $300 million notes due 2028, 2032

By Taylor Fox

New York, Dec. 4 – ADT Inc.’s wholly owned subsidiaries, Prime Security Services Borrower, LLC, Prime Finance Inc. and the ADT Security Corp., commenced tender offers to purchase up to $300 million of outstanding 6¼% second-priority senior secured notes due 2028 (Cusip: 74166MAE6) and 4 7/8% first-priority senior secured notes due 2032 (Cusip: 74166NAA2), according to a news release.

There is $1.3 billion outstanding of the 6¼% notes and $728,016,000 outstanding of the 4 7/8% notes.

The consideration for notes tendered and accepted by the 5 p.m. ET on Dec. 17 early tender deadline will be $1,072.50 per $1,000 of 2028 notes tendered and $1,065 per $1,000 of 2032 notes tendered, including an early tender payment of $30 per $1,000 of notes tendered.

Notes tendered and accepted after the early tender date but before the expiration date will receive the tender offer consideration of $1,042.50 per $1,000 of 2028 notes and $1,035 per $1,000 of 2032 notes.

The 2028 notes will be given a higher acceptance priority than the 2032 notes.

Subject to the offer limit and proration, all notes tendered at or before the early tender time having a higher acceptance priority level will be accepted before any notes tendered at or before the early tender time having a lower acceptance priority level are accepted, and all notes validly tendered after the early tender time having a higher acceptance priority level will be accepted before any notes tendered after the early tender time having a lower acceptance priority level are accepted in the tender offers.

If the tender offers are not fully subscribed as of the early tender time, subject to the offer limit, notes tendered at or before the early tender time will be accepted for purchase in priority to other notes tendered after the early tender time, even if such notes tendered after the early tender time have a higher acceptance priority level than notes tendered prior to the early tender time.

The offers will be funded with cash on hand.

In September, ADT received $450 million of proceeds from an equity investment in the company by Google and has stated its intention to use these proceeds to reduce debt and fund growth investments in 2020 and beyond.

The early settlement date is expected to be Dec. 18.

The offer will expire at 11:59 p.m. ET on Jan. 4.

The final settlement date is expected to be Jan. 5.

BNP Paribas Securities Corp. (212 841-3059, 888 210-4358; dl.us.liability.management@us.bnpparibas.com) is the dealer manager.

D.F. King & Co., Inc. (212 269-5550, 866 796-3328; adt@dfking.com) is the tender and information agent.

ADT is a Boca Raton, Fla.-based provider of home and business security services.

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