Owens & Minor, Inc. (NYSE: OMI) (the “Company”) today
announced that it has commenced offers to purchase for cash
(collectively, the “Tender Offers” and each a “Tender Offer”) its
outstanding senior notes listed in the table below for a maximum
aggregate purchase price, excluding accrued interest, of up to
$240,000,000 (the “Maximum Aggregate Purchase Price”) and, with
respect to the 2021 Notes, a Consent Solicitation (as defined
below), upon the terms and conditions described in the Company’s
Offer to Purchase dated June 5, 2020 (the “Offer to Purchase”).
Capitalized terms used herein but not otherwise defined shall have
the meaning ascribed thereto in the Offer to Purchase.
Dollars per $1,000 Principal
Amount of Notes
Series of Notes
CUSIP Number
Aggregate Principal Amount
Outstanding ($)
Sub-Cap ($)
Acceptance Priority
Level
Tender Offer Consideration
($)
Early Tender Premium
($)
Total Consideration (1) (2)
($)
3.875% Senior Notes due 2021
690732AD4
$233,089,000
N/A
1
$
950.00
$
50.00
$
1,000.00
4.375% Senior Notes due 2024
690732AE2
$275,000,000
$15,000,000
2
$
850.00
$
50.00
$
900.00
(1) Does not include accrued interest, which will also be
payable to but not including the applicable settlement date. (2)
Includes the applicable Early Tender Premium.
Subject to the Maximum Aggregate Purchase Price and the 2024
Notes Sub-Cap (each subject to increase by the Company), the amount
of a series of Notes that is purchased in the Tender Offers on the
applicable settlement date will be based on the order of priority
(the “Acceptance Priority Level”) for such series of Notes as set
forth in the table above, subject to the proration arrangements
applicable to the Tender Offers. Subject to the Maximum Aggregate
Purchase Price, the maximum aggregate purchase price (subject to
increase by the Company, the “2024 Notes Sub-Cap”) to be paid by
the Company for the 2024 Notes, excluding accrued interest, will be
limited to $15 million.
The Tender Offers will expire at 11:59 p.m., New York City time,
on July 2, 2020, unless extended or terminated by the Company (the
“expiration date”). No tenders submitted after the expiration date
will be valid. Subject to the terms and conditions of the Tender
Offers and the Consent Solicitation, the consideration for each
$1,000 principal amount of Notes validly tendered and accepted for
purchase pursuant to the Tender Offers will be the applicable
tender offer consideration for such series of Notes set forth in
the above table (with respect to each series of Notes, the “Tender
Offer Consideration”). Holders of Notes that are validly tendered
prior to 5:00 p.m., New York City time, on June 18, 2020 (subject
to extension, the “early tender time”) and accepted for purchase
pursuant to the applicable Tender Offer will receive the applicable
Tender Offer Consideration and the applicable early tender premium
for such series of Notes as set forth in the table above (the
“Early Tender Premium” and, together with the applicable Tender
Offer Consideration, the “Total Consideration”). Holders of Notes
tendering their Notes after the early tender time will be eligible
to receive the applicable Tender Offer Consideration but will not
be eligible to receive the Early Tender Premium. All holders of
Notes validly tendered and accepted for purchase pursuant to the
Tender Offers will also receive accrued and unpaid interest on such
Notes from the last interest payment date with respect to those
Notes to, but not including, the applicable settlement date.
Notes that have been tendered may be withdrawn from the
applicable Tender Offer prior to 5:00 p.m., New York City time,
June 18, 2020 (subject to extension, the “withdrawal deadline”).
Holders of Notes tendered after the withdrawal deadline cannot
withdraw their Notes or, with respect to the 2021 Notes, revoke
their consents under the Consent Solicitation unless the Company is
required to extend withdrawal rights under applicable law. The
Company reserves the right, but is under no obligation, to increase
the Maximum Aggregate Purchase Price or the 2024 Notes Sub-Cap at
any time, subject to applicable law. If the Company increases the
Maximum Aggregate Purchase Price or the 2024 Notes Sub-Cap, it does
not expect to extend the applicable withdrawal deadline, subject to
applicable law.
For Notes tendered at or prior to the early tender time and not
subsequently validly withdrawn and accepted for purchase, the
Company has the option for settlement to occur on the Early
Settlement Date, which will be any date between the early tender
time and the expiration date, and which will be determined by the
Company and is expected to be June 22, 2020, the second business
day following the early tender time. Settlement for Notes tendered
after the early tender time, but at or prior to the expiration
date, is expected to occur on July 6, 2020, the second business day
following the expiration date, unless extended.
If an aggregate principal amount of Notes validly tendered prior
to the early tender time is such that the aggregate purchase price
for such Notes equals or exceeds the Maximum Aggregate Purchase
Price, excluding accrued interest, the Company will not accept for
purchase any Notes tendered after the applicable early tender time
and will, subject to the 2024 Notes Sub-Cap, accept for purchase
only the Notes tendered before the early tender time pursuant to
the Acceptance Priority Levels. Acceptance for tenders of Notes of
a series may be subject to proration if the aggregate principal
amount of such series of Notes validly tendered would result in an
aggregate purchase price that exceeds the Maximum Aggregate
Purchase Price or the 2024 Notes Sub-Cap.
As part of the Tender Offer for the 2021 Notes, the Company is
also soliciting consents (the “Consent Solicitation”) from the
holders of the 2021 Notes for certain proposed amendments described
in the Offer to Purchase that would, among other things, remove
certain covenants and events of default contained in the Indenture
dated as of September 16, 2014 (as supplemented, the “Indenture”)
between the Company and U.S. Bank National Association (the
“trustee”), as trustee, with respect to the 2021 Notes (the
“Proposed Amendments”). Adoption of the Proposed Amendments with
respect to the 2021 Notes requires the consent of the holders of at
least a majority of the outstanding principal amount of the 2021
Notes (the “Requisite Consents”). Each holder tendering 2021 Notes
pursuant to the Tender Offers must also deliver a consent to the
Proposed Amendments pursuant to the related Consent Solicitation
and will be deemed to have delivered their consents by virtue of
such tender. Holders of the 2021 Notes may not deliver consents
without also tendering their 2021 Notes prior to the expiration
date. The Proposed Amendments will not become operative until (i)
2021 Notes satisfying the Requisite Consent have been validly
tendered, and (ii) the Company consummates the Tender Offer with
respect to the 2021 Notes in accordance with its terms and in a
manner resulting in the purchase of all 2021 Notes validly tendered
before the early tender time. If the Proposed Amendments become
operative with respect to the 2021 Notes, holders of the 2021 Notes
who tender their 2021 Notes after the early tender time and prior
to the expiration date and do not have their 2021 Notes accepted
for purchase and holders of the 2021 Notes that do not tender their
2021 Notes at all will be bound by the Proposed Amendments, meaning
that the 2021 Notes will no longer have the benefit of the existing
certain covenants contained in the Indenture. In addition, such
holders will not receive either the Tender Offer Consideration or
the Early Tender Premium. The Proposed Amendments, if effective,
will not amend the Indenture with respect to the 2024 Notes.
The Tender Offers are not conditioned upon the tender of any
minimum principal amount of Notes of any series nor on the delivery
of a number of consents required to amend the Indenture with
respect to the 2021 Notes. However, the Tender Offers and Consent
Solicitation are subject to, and conditioned upon, the satisfaction
or waiver of certain conditions described in the Offer to Purchase,
including the consummation of the sale of the Company’s Movianto
business and certain support functions in the Company's Dublin
office (the “Movianto Sale”) to Walden Group SAS or an affiliate
(the “Buyer”) pursuant to the terms of the Purchase Agreement,
dated as of April 6, 2020, as amended from time to time, by and
among the Company, Owens & Minor International Logistics, Inc.,
the Buyer and EHDH and the receipt by the Company of unrestricted
net cash proceeds of at least $133.0 million (the “Movianto Sale
Condition”).
The Company intends to fund the Tender Offers with cash on hand,
the proceeds of the Movianto Sale and/or use of funds from its
accounts receivable securitization program.
The purpose of the Tender Offers is to purchase the Notes,
subject to the Maximum Aggregate Purchase Price and the 2024 Notes
Sub-Cap, and reduce debt. If the Tender Offers are not consummated,
or if the amount of Notes accepted for purchase in the Tender
Offers results in the payment of less than the Maximum Aggregate
Purchase Price, the Company may use the remaining amount of
proceeds from the Movianto Sale originally dedicated to the Tender
Offers to repay or retire other outstanding debt. The purpose of
the Consent Solicitation is to obtain Requisite Consents to adopt
the Proposed Amendments with respect to the 2021 Notes.
Citigroup Global Markets Inc. is the Dealer Manager and
Solicitation Agent in the Tender Offers and Consent Solicitation.
D.F. King & Co., Inc. has been retained to serve as the Tender
Agent and Information Agent for the Tender Offers and Consent
Solicitations. Persons with questions regarding the Tender Offers
and Consent Solicitation should contact Citigroup Global Markets
Inc. at (toll free) (800) 558-3745 or (collect) (212) 723-6106.
Requests for the Offer to Purchase should be directed to D.F. King
& Co., Inc. at (toll free) (866) 796-6898 or by email to
omi@dfking.com.
None of the Company, the Dealer Manager and Solicitations Agent,
the Tender Agent and Information Agent, the trustee under the
Indenture governing the Notes or any of their respective affiliates
is making any recommendation as to whether holders should tender
any Notes in response to the Tender Offers and Consent
Solicitation. Holders must make their own decision as to whether to
participate in the Tender Offers and Consent Solicitation, and, if
so, the principal amount of Notes as to which action is to be
taken.
This news release shall not constitute an offer to sell, a
solicitation to buy or an offer to purchase or sell any securities.
The Tender Offers and Consent Solicitation are being made only
pursuant to the Offer to Purchase and only in such jurisdictions as
is permitted under applicable law. In any jurisdiction in which the
Tender Offers are required to be made by a licensed broker or
dealer, the Tender Offers will be deemed to be made on behalf of
the Company by the Dealer Manager, or one or more registered
brokers or dealers that are licensed under the laws of such
jurisdiction.
About Owens & Minor, Inc.
Owens & Minor, Inc. (NYSE: OMI) is a global healthcare
solutions company with integrated technologies, products, and
services aligned to deliver significant and sustained value for
healthcare providers and manufacturers across the continuum of
care. With 17,000 dedicated teammates serving healthcare industry
customers in 90 countries, Owens & Minor helps to reduce total
costs across the supply chain by optimizing episode and
point-of-care performance, freeing up capital and clinical
resources, and managing contracts to optimize financial
performance. A FORTUNE 500 company, Owens & Minor was founded
in 1882 in Richmond, Virginia, where it remains headquartered
today. The company has distribution, production, customer service
and sales facilities located across the Asia Pacific region,
Europe, Latin America, and North America.
Forward-Looking Statement
This news release contains “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of
1995. Although we believe our expectations with respect to the
forward-looking statements are based upon reasonable assumptions
within the bounds of our knowledge of our business and operations,
all forward-looking statements involve risks and uncertainties and,
as a result, actual results could differ materially from those
projected, anticipated or implied by these statements. Such
forward-looking statements involve known and unknown risks,
including, but not limited to: our ability to consummate each
Tender Offer and the Consent Solicitation, our ability to satisfy
the Movianto Sale Condition and other conditions and our ability to
achieve revenue and operating income goals, which may be affected
by COVID-19. Unless legally required, Owens & Minor, Inc.
undertakes no obligation to update publicly any forward-looking
statements, whether as a result of new information, future events
or otherwise.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200605005084/en/
Chuck Graves, Director, Finance & Investor Relations,
chuck.graves@owens-minor.com, 804-723-7556
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