Invitel Holdings A/S (NYSE Amex U.S.: IHO) (“Invitel”) announced
today a series of transactions that would result in Mid Europa
Partners Limited (“Mid Europa”) becoming the controlling
shareholder of Invitel and a de-leveraging of the cash-pay debt of
Invitel and its subsidiaries (the “Invitel Group”). The closing of
each of these transactions is interconditional upon the closing of
the other transactions. The series of transactions include the
following transactions discussed below:
TDC A/S (“TDC”) and Mid Europa announced today an agreement
whereby Mid Europa will acquire from TDC 10,799,782 Invitel shares
(64.6% of the outstanding shares, TDC’s entire shareholding), for
$1.00 per share (the “Share Acquisition”). The Share Acquisition is
subject to certain conditions precedent, including the approval
from relevant regulatory authorities. Depending on the status of
the regulatory approval at the time of closing of the transaction,
TDC and Mid Europa may decide to complete the Share Acquisition in
two steps.
In connection with the transactions, Mid Europa will purchase
all of TDC’s rights and obligations under a €34.1 million
subordinated PIK loan (“Shareholder Loan”), which will be amended
and restated to increase the loan by an amount of up to €91.4
million, on terms substantially similar to the existing loan, to
finance certain activities of Magyar Telecom B.V. (a subsidiary of
Invitel). The additional funds will be principally used by the
Invitel Group to fund the purchase or repayment of a portion of the
Invitel Group’s outstanding debt.
In addition, Hungarian Telecom Finance International Limited
(the “Offeror”), a company controlled by Mid Europa, announced
today a tender offer (the “PIK Notes Offer”) to purchase for cash
the outstanding €125m Floating Rate Senior PIK Notes due 2013
(ISIN: XS0271778671 (144A), XS0271777947 (Reg S)) (the “PIK Notes”)
issued by HTCC Holdco I B.V. (a subsidiary of Invitel) and a
concurrent consent solicitation by HTCC Holdco I B.V. to certain
proposed amendments to the indenture governing the PIK Notes. The
PIK Notes Offer is subject to terms and conditions described in the
tender offer and consent solicitation statement (the “Statement”),
including the valid tendering of more than 50% of the principal
amount of the PIK Notes. The proposed amendments to the indenture
governing the PIK Notes are set out in the Statement.
In connection with the contemplated series of transactions set
out above, core lending banks under the existing senior debt
facility have confirmed their commitment to Invitel by giving their
consent to a number of amendments to certain terms and covenants. A
number of additional banks have provided financing under the senior
facility to secure funding for the Invitel Group going forward.
Credit Suisse Securities (Europe) Limited (“Credit Suisse”), BNP
Paribas and Calyon will act as Joint Dealer Managers (the “Dealer
Managers”), in connection with the tender offer. BNP Paribas and
Calyon acted as Global Coordinators in connection with the Senior
and Subordinated Loan Facilities.
Shareholders Meeting
Invitel’s debt restructuring will be subject to shareholder
approval at a meeting (the “Meeting”) to be held on Wednesday,
October 28, 2009 at 1:00 p.m., local time at Invitel’s principal
Hungarian offices located at Puskas Tivadar u. 8-10 in Budaors,
Hungary H-2040. The Meeting will be an extraordinary general
meeting in accordance with Danish law and Invitel’s Articles of
Association. The purpose of the Meeting is to approve the proposed
debt restructuring and elect alternate directors to the four
directors who currently represent TDC on Invitel’s board of
directors. The four alternate directors have been nominated by Mid
Europa with the unanimous approval of the current board of
directors of Invitel. Following a successful completion of the
contemplated transactions, and upon the resignation of TDC’s
representatives on Invitel’s board of directors, the four alternate
directors would replace the current four directors from TDC.
Invitel has set October 6, 2009 as the record date for determining
the ADR holders of the Company’s American depositary shares
(“ADSs”) entitled to receive a proxy to instruct the Depositary
(Deutsche Bank Trust Company Americas) as to the exercise of the
voting rights pertaining to the ordinary shares represented by
their respective ADSs. TDC has undertaken a commitment to vote in
favour of the above mentioned proposed debt restructuring and
election of alternate directors.
Comments from Invitel
Commenting on the proposed transactions, the Chairman of
Invitel, Henrik Scheinemann, said, “As a result of the
transactions, Invitel will have reduced its cash debt-service
requirements, enhanced its financial flexibility through the
changes to its PIK notes terms and the terms of the senior bank
facilities, and the company will have reduced its refinancing risk.
Invitel will also welcome a new majority shareholder with deep
expertise in the telecom sector and region, replacing TDC, which
had previously disclosed its intention to focus on its core markets
in Denmark and the Nordic region.”
Comments from Mid Europa Partners
Commenting on the transactions, Craig Butcher, Senior Partner of
Mid Europa Partners, said, “We are very pleased to renew our
association with the Invitel Group. Since our previous ownership of
one of its component businesses, the Group has been transformed
through several mergers and acquisitions into today’s much larger
and more diversified business. Our contemplated investment in the
Invitel Group, through the series of transactions announced today,
will strengthen Invitel’s balance sheet and better enable it to
realise the growth potential of several of its core markets. Mid
Europa Partners looks forward to working with the board and
management of Invitel to support its future development for the
benefit of all its stakeholders.”
ABOUT INVITEL HOLDINGS A/S
Invitel Holdings A/S is the number one alternative and the
second-largest fixed line telecommunications and broadband internet
services provider in the Republic of Hungary. In addition to
delivering voice, data and internet services in Hungary, it is also
a leading player in the Central and Eastern European wholesale
telecommunications market.
ABOUT MID EUROPA PARTNERS
Mid Europa Partners is a leading independent private equity firm
focused on Central and Eastern Europe. Operating from London,
Budapest and Warsaw, Mid Europa Partners advises and manages funds
with asset value of approximately €3.2 billion. The Mid Europa
Partners team has been investing in Central and Eastern Europe
since 1999.
Forward-Looking Statements and
Legal Information
The information above includes forward-looking statements about
the Invitel Group. These and all forward-looking statements are
only predictions of current plans that are constantly under review
by Invitel Holdings. Such statements are qualified by important
factors that may cause actual results to differ from those
contemplated, including those risk factors detailed from time to
time in Invitel Holdings’ U.S. Securities and Exchange Commission
(“SEC”) filings, which may not be exhaustive. For a discussion of
such risk factors, see Invitel Holdings’ filings with the SEC
including, but not limited to, its 2008 Annual Report on Form 20-F.
Invitel Holdings operates in a continually changing business
environment, and new risk factors emerge from time to time. Invitel
Holdings cannot predict such new risk factors, nor can it assess
the impact, if any, of such new risk factors on its business or
events described in any forward-looking statements. Invitel
Holdings has no obligation to publicly update or revise any
forward-looking statements to reflect the occurrence of future
events or circumstances.
This press release does not constitute or form a part of an
offer of securities for sale in the United States (including its
territories and possessions, any State of the United States and the
District of Columbia). Securities may not be offered or sold into
the United States absent registration or an exemption from
registration as provided in the U.S. Securities Act of 1933, and
the rules and regulations thereunder.
The information contained herein does not constitute an offer to
sell or the solicitation of an offer to buy, nor will there be a
tender for any securities referred to herein in any jurisdiction in
which such offer to sell or solicitation of an offer to buy or
tender would be unlawful prior to registration, exemption from
registration or qualification under the securities laws of any such
jurisdiction. The forwarding distribution and reproduction of this
press release may be restricted by law in certain jurisdictions and
persons into whose possession this press release or other
information referred to herein comes should inform themselves about
and observe any such restrictions.
Offer Restrictions
Belgium
Neither this press release nor any other documents or materials
relating to the PIK Notes Offer have been submitted to or will be
submitted for approval or recognition to the Belgian Banking,
Finance and Insurance Commission (Commission bancaire, financière
et des assurances/Commissie voor het Bank-, Financie en
Assurantiewezen) and, accordingly, the PIK Notes Offer may not be
made in Belgium by way of a public offering, as defined in Article
3 of the Belgian Law of April 1, 2007 on public takeover bids and
as defined in Article 3 of the Belgian Law of June 16, 2006 on the
public offer of placement instruments and the admission to trading
of placement instruments on regulated markets (together the
“Belgian Public Offer Law”), each as amended or replaced from time
to time. Accordingly, the PIK Notes Offer may not be advertised and
the PIK Notes Offer will not be extended, and neither this press
release nor any other documents or materials relating to the PIK
Notes Offer (including any memorandum, information circular,
brochure or any similar documents) has been or shall be distributed
or made available, directly or indirectly, to any person in Belgium
other than “qualified investors” as referred to in Article 10, of
the Belgian Public Offer Law (as amended from time to time) acting
on their own account. Insofar as Belgium is concerned, this press
release has been issued only for the personal use of the above
qualified investors and exclusively for the purpose of the PIK
Notes Offer. Accordingly, the information contained in this press
release may not be used for any other purpose or disclosed to any
other person in Belgium.
France
The PIK Notes Offer is not being made, directly or indirectly,
to the public in the Republic of France (“France”). Neither this
press release nor any other document or material relating to the
PIK Notes Offer has been or shall be distributed to the public in
France and only (i) providers of investment services relating to
portfolio management for the account of third parties and/or (ii)
qualified investors (Investisseurs Qualifiés) other than
individuals, in each case acting on their own account and all as
defined in, and in accordance with, Articles L.411-2 and D.411-1 of
the French Code Monétaire et Financier, are eligible to participate
in the Offers.
This press release has not been and will not be submitted for
clearance to the Autorité des Marchés Financiers.
Italy
The PIK Notes Offer is not being made, directly or indirectly,
in the Republic of Italy (“Italy”). The PIK Notes Offer and this
press release have not been submitted to the clearance procedures
of the Commissione Nazionale per le Società e la Borsa (CONSOB)
pursuant to Italian laws and regulations. Accordingly, holders of
PIK Notes are notified that, to the extent holders of PIK Notes are
located or resident in Italy, the PIK Notes Offer is not available
to them and they may not tender PIK Notes in the PIK Notes Offer
and, as such, any electronic instructions (as defined below)
received from such persons shall be ineffective and void, and
neither this press release nor any other documents or materials
relating to the PIK Notes Offer or the PIK Notes may be distributed
or made available in Italy.
United Kingdom
The communication of this press release and any other documents
or materials relating to the PIK Notes Offer is not being made and
such documents and/or materials have not been approved by an
authorised person for the purposes of section 21 of the Financial
Services and Markets Act 2000. Accordingly, such documents and/or
materials are not being distributed to, and must not be passed on
to, the general public in the United Kingdom. The communication of
such documents and/or materials as a financial promotion is only
being made to those persons in the United Kingdom falling within
the definition of investment professionals (as defined in Article
19(5) of the Financial Services and Markets Act 2000 (Financial
Promotion) Order 2005 (the “Financial Promotion Order”)) or persons
who are within Article 43 of the Financial Promotion Order or any
other persons to whom it may otherwise lawfully be made under the
Financial Promotion Order.
General
This press release and any related documents do not constitute
an offer to buy or the solicitation of an offer to sell PIK Notes
in any circumstances in which such offer or solicitation is
unlawful. In those jurisdictions where the securities, blue sky or
other laws require the PIK Notes Offer to be made by a licensed
broker or dealer, and a Dealer Manager or any of its affiliates is
such a licensed broker or dealer in such jurisdictions, the PIK
Notes Offer shall be deemed to be made by such Dealer Manager or
such affiliate (as the case may be) on behalf of the Offeror in
such jurisdictions.
Each holder of PIK Notes participating in the PIK Notes Offer
will also be deemed to give certain representations in respect of
the other jurisdictions referred to above and generally as set out
in the Statement. Any tender of PIK Notes for purchase pursuant to
the PIK Notes Offer from a holder of PIK Notes that is unable to
make these representations will not be accepted. Each of the
Offeror, the Dealer Managers and the tender agent reserve the
right, in their absolute discretion, to investigate, in relation to
any tender of PIK Notes for purchase pursuant to the PIK Notes
Offer, whether any such representation given by a holder of PIK
Notes is correct and, if such investigation is undertaken and as a
result the Offeror determines (for any reason) that such
representation is not correct, such tender shall not be
accepted.
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