Votorantim Cimentos International S.A. Launches Tender Offers For Up To U.S. $650 Million In Aggregate Principal Amount Of Its 7.250% Senior Notes Due 2041, 3.500% Notes Due 2022 And 3.250% Notes Due 2021 And A Consent Solicitation Relating To Its 7.250%

LUXEMBOURG, Jan. 10, 2019 — Votorantim Cimentos International S.A. (“VCI“), a direct, wholly-owned subsidiary of Votorantim Cimentos S.A. (“VCSA“), today announced that it has commenced (i) an offer to purchase for cash (collectively, the “Tender Offers“) up to U.S.$650 million in aggregate principal amount (the “Aggregate Maximum Acceptance Limit“) of its outstanding 7.250% Senior Notes due 2041 (the “2041 Notes“), 3.500% Notes due 2022 (the “2022 Notes“) and 3.250% Notes due 2021 (the “2021 Notes” and, together with the 2041 Notes and the 2022 Notes, the “Notes“) and (ii) a consent solicitation to solicit consents (the “2041 Consent Solicitation“) from holders of the 2041 Notes to amend (the “Proposed Amendments“) the indenture governing the 2041 Notes to eliminate substantially all of the restrictive covenants, as well as various events of default and related provisions, contained in such indenture. In addition to the Aggregate Maximum Acceptance Limit, the amount of a series of Notes that is purchased in the Tender Offers on any Settlement Date (as defined below) will be based on the order of priority (the “Acceptance Priority Level“) for such series of Notes as set forth in the table below. The 2041 Notes are guaranteed by Votorantim S.A. (“VSA“) and VCSA. The 2022 Notes and 2021 Notes are guaranteed by VCSA.

The Tender Offers and the Concurrent 2041 Notes Exchange Offer (as defined below) are being conducted as part of VCSA's internationalization strategy and corporate reorganization that advances VCSA's international expansion, in addition to enabling a more efficient capital management.

The Tender Offers and the 2041 Consent Solicitation are being made pursuant to VCI's Offer to Purchase and Consent Solicitation Statement, dated January 10, 2019 (the “Offer to Purchase“), which sets forth a more comprehensive description of the terms of the Tender Offers and the 2041 Consent Solicitation. The Tender Offers and the 2041 Consent Solicitation are scheduled to expire at 11:59 p.m., New York City time, on February 7, 2019, unless extended or terminated earlier (the “Expiration Deadline“).  Holders who validly tender and do not validly withdraw Notes on or prior to 5:00 p.m., New York City time, on January 24, 2019, unless extended (the “Early Expiration Deadline“), will receive the “Total Tender Consideration” indicated in the table below, which includes the “Early Tender Payment” indicated in the table below, with respect to such series of Notes, subject to the Aggregate Maximum Acceptance Limit and the Acceptance Priority Level. Holders who validly tender (and do not validly withdraw) Notes after the Early Expiration Deadline but prior to the Expiration Deadline will receive the “Tender Offer Consideration” indicated in the table below. Accrued and unpaid interest on the Notes accepted for purchase from the last interest payment date of such series of Notes up to but excluding the applicable Settlement Date will be paid in cash on the applicable Settlement Date.

The following table sets forth certain terms of the Tender Offers:         

 

Title of Notes

 

CUSIP No. / ISIN No.

Outstanding Principal
Amount

Acceptance

Priority Level

Tender Offer 
Consideration(1)(2)

+

Early Tender
Payment(1)(2)(3)

=

Total Tender
Consideration(1)(3)(4)

7.250% Senior Notes
due 2041………..

92911QAA5; P98088AA8 /

US92911QAA58; USP98088AA83

U.S.$1,150,500,000

1

U.S.$1,035.00

U.S.$30

U.S.$1,065.00

3.500% Notes

due 2022………..

N/A /

XS1232126810; XS1232127115

€346,720,000

2

€1,007.50

€30

€1,037.50

3.250% Notes

due 2021………..

N/A /

XS1061030117;XS1061029614

€214,293,000

3

€1,002.50

€30

€1,032.50

(1) Consideration in the form of cash per U.S.$1,000 or €1,000, as applicable, principal amount of such series of Notes that are validly tendered and not validly withdrawn, subject to any rounding as described in the Offer to Purchase.

(2) With respect to the 2022 Notes and 2021 Notes, VCI will determine whether the Aggregate Maximum Acceptance Limit has been exceeded by converting the principal amount of the 2022 Notes and 2021 Notes validly tendered (and not validly withdrawn) and accepted for purchase into U.S. dollars using the applicable exchange rates, as further described in the Offer to Purchase.

(3) The Early Tender Payment will be payable to holders who validly tender (and not validly withdraw) Notes on or prior to the Early Expiration Deadline.

(4) Includes the Early Tender Payment for Notes validly tendered (and not validly withdraw) on or prior to the Early Expiration Deadline.

The obligation of VCI to accept tendered Notes and to accept delivered consents pursuant to the Tender Offers and the 2041 Consent Solicitation, respectively, is subject to certain conditions, which include, the Fibria Sale Condition (as defined in the Offer to Purchase), the receipt of Notes validly tendered (and not validly withdrawn) pursuant to the Offer to Purchase (including, if applicable, any 2041 Notes tendered pursuant to a 2041 Notes Exchange Offer Purchase Election (as defined below) made in accordance with the terms of the Concurrent 2041 Notes Exchange Offer) in an aggregate principal amount of at least U.S.$500.0 million (the “Minimum Tender Condition“), and the receipt of 2041 Notes validly tendered (and not validly withdrawn) pursuant to the Concurrent 2041 Notes Exchange Offer (including, if applicable, any 2041 Notes tendered pursuant to an Exchange Election (as defined below)) in an aggregate principal amount of at least U.S.$300.0 million (the “Exchange Offer Condition“)).  VCI reserves the right, in its sole discretion, not to accept any tenders of Notes or deliveries of consents with respect to the 2041 Consent Solicitation for any reason. 

VCI reserves the right but is under no obligation, at any point following the Early Expiration Deadline and before the Expiration Deadline, to accept for purchase any Notes validly tendered and not validly withdrawn at or prior to the Early Expiration Deadline (the “Early Settlement Date“), subject to the Aggregate Maximum Acceptance Limit and the Acceptance Priority Level. The Early Settlement Date will be determined at VCI's option, subject to all conditions to the Tender Offers having been satisfied or waived by VCI. Irrespective of whether VCI chooses to exercise its option to have an Early Settlement Date, VCI will purchase any remaining Notes that have been validly tendered and not validly withdrawn by the Expiration Deadline and that VCI chooses to accept for purchase, subject to the Aggregate Maximum Acceptance Limit, the Acceptance Priority Level and all conditions to the Tender Offers having been satisfied or waived by VCI, on a date promptly following the Expiration Deadline (the “Final Settlement Date” and, each of the Early Settlement Date and Final Settlement Date, a “Settlement Date“). VCI reserves the right, but is not obligated, to increase the Aggregate Maximum Acceptance Limit in its sole and absolute discretion without extending the Early Expiration Deadline or Withdrawal Deadline or otherwise reinstating withdrawal or revocation rights, except as required by applicable law.

To the extent VCI purchases validly tendered and not validly withdrawn 2041 Notes in an aggregate principal amount of the Aggregate Maximum Acceptance Limit on the Early Settlement Date, holders validly tendering 2041 Notes after the Early Expiration Deadline will not be entitled to have any of their 2041 Notes accepted for purchase.

The Proposed Amendments to the indenture governing the 2041 Notes require the consents (the “Requisite Consents“) of holders of a majority in aggregate principal amount of the 2041 Notes outstanding (excluding any 2041 Notes held by VCI or its affiliates). Holders who tender their 2041 Notes into the Tender Offer will also be providing their consents to the Proposed Amendments with respect to such 2041 Notes. In connection with the Concurrent 2041 Notes Exchange Offer, VCI is also seeking the consent of Eligible 2041 Holders (as defined below) to the Proposed Amendments. The Exchange Offer Memorandum requires that any Eligible 2041 Holder tendering its 2041 Notes in the Concurrent 2041 Notes Exchange Offer also have delivered its consents to the Proposed Amendments with respect to such 2041 Notes tendered. Accordingly, any such consents received by VCI in the Concurrent 2041 Notes Exchange Offer shall be added to any consents obtained in the 2041 Consent Solicitation for purposes of calculating the Requisite Consents to effectuate the Proposed Amendments.

Notes validly tendered in the Tender Offers may not be withdrawn, and consents delivered in the 2041 Consent Solicitation may not be revoked, after 5:00 p.m., New York City Time, on January 24, 2019 (unless extended by VCI), except as may be required by applicable law.

Concurrently with the Tender Offers and 2041 Consent Solicitation, VCI is offering Eligible 2041 Holders (as defined below) to exchange (the “Concurrent 2041 Notes Exchange Offer“) an aggregate amount of up to U.S.$500 million (the “2041 Exchange Maximum Acceptance Limit“) of 2041 Notes for newly issued 7.250% Senior Notes due 2041 (the “New St. Marys Notes“) of St. Marys Cement Inc. (Canada), a wholly-owned, direct subsidiary of VCI (“St. Marys”), on the terms and conditions of the Exchange Offer and Consent Solicitation Statement dated as of the date hereof (the “Exchange Offer Memorandum“). Copies of the Exchange Offer Memorandum shall only be provided to, and participation in the Concurrent 2041 Notes Exchange Offer shall be limited to, holders of 2041 Notes (“Eligible 2041 Holders“) who certify that they are either (a) persons other than “U.S. persons” as defined in Regulation S (“Regulation S“) under the Securities Act of 1933, as amended (the “Securities Act“), and who agree to purchase the New St. Marys Notes outside of the United States, and who are otherwise in compliance with the requirements of Regulation S or (b) U.S. persons who are “qualified institutional buyers” as defined in Rule 144A under the Securities Act and to whom the New St. Marys Notes are offered in the United States in a transaction not involving a public offering, pursuant to Section 4(a)(2) of the Securities Act; provided that, in each case, (A) if such holder is in the European Economic Area, such holder (i) is a “qualified investor” within the meaning of Article 2(1)(e) of the Prospectus Directive (Directive 2003/71/EC) and related implementation measures in member states of the European Economic Area (a “qualified investor“) and (ii) is not a retail investor (as defined below), and (B) such holder is not a beneficial owner in or resident of Canada, or an authorized representative acting on behalf of a beneficial owner in or resident of Canada. As used above, the expression “retail investor” means a person who is one (or more) of the following (i) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU (as amended, “MiFID II“), (ii) a customer within the meaning of Directive 2002/92/EC, where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II, or (iii) not a qualified investor. The New St. Marys Notes will not be registered under the Securities Act, or any state securities laws.

If the aggregate principal amount of Notes validly tendered in the Tender Offers exceeds the Aggregate Maximum Acceptance Limit, VCI will accept such Notes on a pro rata basis based on the Acceptance Priority Level. Eligible 2041 Holders may elect, at the time that they tender their 2041 Notes (the “Exchange Election“), to exchange any validly tendered and not validly withdrawn 2041 Notes that were not accepted for purchase in the Tender Offer as a result of proration, for New St. Marys Notes pursuant to and in accordance with the Exchange Offer Memorandum, subject to the 2041 Exchange Maximum Acceptance Limit and with the same priority as holders of 2041 Notes that tendered their notes directly into the Concurrent 2041 Notes Exchange Offer. In the circumstances described in this paragraph, unless an Eligible 2041 Holder validly completes an Exchange Election, any validly tendered and not validly withdrawn 2041 Notes of such Eligible 2041 Holder that are not accepted for purchase in the Tender Offer as a result of proration shall not be eligible for exchange under the Concurrent 2041 Notes Exchange Offer and shall not be accepted for purchase and shall remain outstanding. By delivering an Exchange Election, an Eligible 2041 Holder shall have certified that it (i) is an Eligible 2041 Holder and (ii) has received and reviewed the Exchange Offer Memorandum.  Pursuant to the Offer to Purchase, VCI may, but is not obligated to, increase the 2041 Exchange Maximum Acceptance Limit in its sole and absolute discretion without extending the relevant early expiration deadline or withdrawal deadline or otherwise reinstating withdrawal or revocation rights, except as required by applicable law.

The settlement date for 2041 Notes tendered in the Concurrent 2041 Notes Exchange Offer (including, if applicable, any 2041 Notes tendered pursuant to an Exchange Election) may occur on an earlier date than the Settlement Date of the Tender Offers. In all cases, the relevant settlement date of the Concurrent 2041 Notes Exchange Offer is expected to be within two business days of the relevant Settlement Date for the Tender Offers.

Copies of the Offer to Purchase are available to holders from D.F. King, the information and tender agent for the Tender Offers and the 2041 Consent Solicitation (the “Information and Tender Agent“).  Requests for copies of the Offer to Purchase should be directed to the Information and Tender Agent, (i) in New York, at +1 212 269 5550 (collect) or +1 (800) 735 3591 (toll free), (ii) in London, at  +44 20 7920-9700, (iii) via email, at VotoCim@dfking.com, or (iv) online, at https://sites.dfkingltd.com/VotoCim.

VCI has retained Citigroup Global Markets Inc. (“Citigroup“), Morgan Stanley & Co. LLC (“Morgan Stanley“), BB Securities Limited (“BB Securities“), Banco Bradesco BBI S.A. (“Bradesco“), Itau BBA USA Securities, Inc. (“Itaú BBA“) and Santander Investment Securities Inc. (“Santander“) to act as Dealer Managers in connection with the Tender Offers and as Solicitation Agents in connection with the 2041 Consent Solicitation.  Questions regarding the Tenders Offer and the 2041 Consent Solicitation may be directed to Citigroup at +1 (212) 723-6106 (collect), +1 (800) 558-3745 (toll free); Morgan Stanley at +1 (212) 761-1057 (collect), +1 (800) 624-1808 (toll free); BB Securities at +(44) 20 7367-5832 (collect); Bradesco BBI at +1 (212) 888-9145 (collect); Itaú BBA at +1 (888) 770-4828 (toll free); and Santander at +1 (212) 940-1442 (collect) and +1 (855) 404-3636 (toll free).

Neither the Offer to Purchase nor any related documents have been filed with the U.S. Securities and Exchange Commission, nor have any such documents been filed with or reviewed by any federal or state securities commission or regulatory authority of any country. No authority has passed upon the accuracy or adequacy of the Offer to Purchase or any related documents, and it is unlawful and may be a criminal offense to make any representation to the contrary.

This announcement is not an offer to purchase, a solicitation of an offer to purchase or a solicitation of consents, including with respect to the Concurrent 2041 Notes Exchange Offer.  The Tender Offers and the 2041 Consent Solicitation are being made solely pursuant to the Offer to Purchase.  VCI is making the Tender Offers and the 2041 Consent Solicitation only in those jurisdictions where it is legal to do so.  The Tender Offers and the 2041 Consent Solicitation are not being made to, nor will VCI accept tenders of Notes and deliveries of consents from, holders in any jurisdiction in which the Tender Offers and the 2041 Consent Solicitation or the acceptance thereof would not be in compliance with the securities or blue sky laws of such jurisdiction.

About Votorantim Cimentos International S.A.

VCI is a direct, wholly-owned subsidiary of VCSA, a global vertically integrated heavy building materials company, with operations in South America, North America, Europe, Africa and Asia. Votorantim Cimentos produces and sells a complete portfolio of building materials—which includes cement, aggregates, ready mix concrete, mortar and other building materials—and Votorantim Cimentos serves a highly diversified and fragmented client base. Votorantim Cimentos is a wholly-owned, direct subsidiary of Votorantim S.A., a privately held conglomerate in Latin America that is a strong player in each of its main business segments: cement; non-ferrous metals, such as zinc, aluminum, nickel and copper, as well as significant steel and power generation operations.

NOTICE REGARDING FORWARD-LOOKING STATEMENTS

This press release contains statements that are forward-looking within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. Forward-looking statements are only predictions and are not guarantees of future performance. Investors are cautioned that any such forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to VCI and its affiliates that may cause the actual results to be materially different from any future results expressed or implied in such forward-looking statements. Although VCI believes that the expectations and assumptions reflected in the forward-looking statements are reasonable based on information currently available to VCI's management, VCI cannot guarantee future results or events. VCI expressly disclaims a duty to update any of the forward-looking statements.

SOURCE Votorantim Cimentos International S.A.

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About the Author: Bob Cooper

Bob Cooper is Canadian Business Tribune''s senior editor. He is also a nationally syndicated newspaper columnist and a bestselling author. He lives in London Ontario and covers the intersection of money, politics and finance. He appears periodically on national television shows and has been published in (among others) The National Post, Politico, The Atlantic, Harper’s, Wired.com, Vice and Salon.com. He also has served as a journalist and consultant on documentaries for CBC and Global News . In 2014, he was the winner of the Society of American Business Editors and Writers' investigative journalism award, and the winner of the Izzy Award for Journalism from Ithaca College's Park Center for Independent Media. He was also a finalist for UCLA's Gerald R. Loeb Award and Syracuse University's Mirror Award. Before becoming a journalist in 2006, Sirota worked in Washington for, among others, U.S. Rep. Bernie Sanders, the U.S. House Appropriations Committee Minority Staff and the Center for American Progress.

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