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Braskem Finance Limited Announces That Credit Suisse Securities (USA) LLC Has Launched Tender Offers For Any And All Of 8.00% Notes Due 2017 and 7.25% Notes Due 2018; And A Tender Offer And Consent Solicitation For Up To The 2020 Notes Maximum Tender Amou

SAO PAULO, April 16, 2014 /PRNewswire/ -- Braskem Finance Limited ("Braskem Finance"), a financing subsidiary of Braskem S.A. ("Braskem"), today announced that Credit Suisse Securities (USA) LLC (the "Offeror") has launched (i) an offer to purchase for cash (the "2017 Notes Tender Offer") any and all of Braskem Finance's outstanding 8.00% Notes due 2017 (the "2017 Notes"), (ii) an offer to purchase for cash (the "2018 Notes Tender Offer") any and all of Braskem Finance's outstanding 7.25% Notes due 2018 (the "2018 Notes"), and (iii) an offer to purchase for cash (the "2020 Notes Tender Offer" and, together with the 2017 Notes Tender Offer and the 2018 Notes Tender Offer, the "Tender Offers") Braskem Finance's outstanding 7.00% Notes due 2020 (the "2020 Notes" and, together with the 2017 Notes and the 2018 Notes, the "Notes") in an aggregate principal amount such that the amount of 2020 Notes Total Consideration and 2020 Notes Tender Offer Consideration (each as defined below) paid by the Offeror does not exceed (x) U.S.$250.00 million less (y) the aggregate 2017 Notes Total Consideration and 2018 Notes Total Consideration (each as defined below) paid by the Offeror to the holders of 2017 Notes and 2018 Notes, respectively, whose Notes were validly tendered and accepted for purchase on the applicable early settlement date pursuant to the 2017 Notes Tender Offer and the 2018 Notes Tender Offer, respectively (the "2020 Notes Maximum Tender Amount"). 

In connection with the 2020 Notes Tender Offer, the Offeror is also soliciting (the "2020 Notes Consent Solicitation") the consents of the holders of the 2020 Notes to the adoption of certain amendments (the "2020 Proposed Amendments") to the indenture governing the 2020 Notes to eliminate substantially all of the restrictive covenants, as well as various events of default and related provisions contained in such indenture. The 2020 Proposed Amendments require the consents (the "2020 Requisite Consents") of holders of at least a majority in aggregate principal amount of the outstanding 2020 Notes (excluding any 2020 Notes held by the Braskem Finance or its affiliates). Holders who tender their 2020 Notes pursuant to the 2020 Notes Tender Offer will also be providing consents with respect to such 2020 Notes to the 2020 Proposed Amendments.

The 2020 Notes Consent Solicitation will be terminated if (i) the 2020 Requisite Consents are not obtained or (ii) the 2020 Notes are subject to proration, and in each case, the 2020 Proposed Amendments to the indenture governing the 2020 Notes will not become effective; however, the Offeror reserves the right in its sole discretion to accept and purchase 2020 Notes tendered pursuant to the concurrent 2020 Notes Tender Offer for an amount in cash equal to the 2020 Notes Total Consideration or the 2020 Notes Tender Offer Consideration, as applicable. The 2020 Notes Maximum Tender Amount is currently not sufficient to permit the Offeror to receive the 2020 Requisite Consents.  Therefore, the 2020 Proposed Amendments to the indenture governing the 2020 Notes will not become effective unless the Offeror increases the 2020 Notes Maximum Tender Amount, which it may do in its sole discretion.  However, there can be no assurance that the Offeror will increase the 2020 Notes Maximum Tender Amount.

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

 

 

Title of Security

Aggregate Principal

Amount Outstanding1

Maximum Acceptance

Limit

Acceptance Priority

Level

Total Consideration2

8.00% Notes due 2017

(CUSIP No. 105532 AD7 /

ISIN US105532AD74)

(CUSIP No. P18533 AK8 /

ISIN USP18533AK80)

U.S.$ 85,093,000

Any and All

1

U.S.$1,145.00

7.25% Notes due 2018

(CUSIP No. 10553Y AA3 /

ISIN US10553YAA38)

(CUSIP No. G1315R AA9 /

ISIN USG1315RAA98)

U.S.$ 260,316,000

Any and All

1

U.S.$1,167.50

7.00% Notes due 2020

(CUSIP No. 10553Y AB1 /

ISIN US10553YAB11)

(CUSIP No. G1315R AB7 /

ISIN USG1315RAB71)

U.S.$ 584,316,000

2020 Notes Maximum Tender Amount

2

U.S.$1,115.00


(1) Amount includes U.S.$4,328,000 of 2017 Notes, U.S.$82,421,000 of 2018 Notes and U.S.$2,500,000 of 2020 Notes, in each case, held by Braskem or its affiliates.

(2) The amount to be paid for each U.S.$1,000 principal amount of applicable series of Notes validly tendered and accepted for purchase. In addition, the Offeror will pay accrued and unpaid interest up to, but not including, the applicable settlement date ("Accrued Interest"). In each case, the Total Consideration includes an early tender payment of U.S.$50.00.

 

The 2017 Notes Tender Offer will expire at 12:00 Midnight, New York City time, on May 13, 2014, unless extended by the Offeror (such time and date, as the same may be extended, the "2017 Notes Expiration Date"). Holders of 2017 Notes ("2017 Notes Holders") who validly tender their 2017 Notes at or prior to 5:00 p.m., New York City time, on April 29, 2014, unless extended by the Offeror (such time and date, as the same may be extended, the "2017 Notes Early Tender Date"), will be eligible to receive the 2017 Notes Total Consideration, which includes the 2017 Notes Early Tender Payment (as defined below), plus Accrued Interest.  The 2018 Notes Tender Offer will expire at 12:00 Midnight, New York City time, on May 13, 2014, unless extended by the Offeror (such time and date, as the same may be extended, the "2018 Notes Expiration Date"). Holders of 2018 Notes ("2018 Notes Holders") who validly tender their 2018 Notes at or prior to 5:00 p.m., New York City time, on April 29, 2014, unless extended by the Offeror (such time and date, as the same may be extended, the "2018 Notes Early Tender Date"), will be eligible to receive the 2018 Notes Total Consideration, which includes the 2018 Notes Early Tender Payment (as defined below), plus Accrued Interest.  The 2020 Notes Tender Offer and related 2020 Notes Consent Solicitation will expire at 12:00 Midnight, New York City time, on May 13, 2014, unless extended by the Offeror (such time and date, as the same may be extended, the "2020 Notes Expiration Date"). Holders of 2020 Notes ("2020 Notes Holders") who validly tender their 2020 Notes and deliver their related consents to the 2020 Proposed Amendments at or prior to 5:00 p.m., New York City time, on April 29, 2014, unless extended by the Offeror (such time and date, as the same may be extended, the "2020 Notes Early Tender Date"), will be eligible to receive the 2020 Notes Total Consideration, which includes the 2020 Notes Early Tender Payment (as defined below), plus Accrued Interest.

2017 Notes and 2018 Notes that have been validly tendered cannot be withdrawn, except as may be required by applicable law. 2020 Notes Holders will be permitted to withdraw validly tendered 2020 Notes and revoke related consents at any time prior to the execution and delivery of a supplemental indenture containing the 2020 Proposed Amendments (at which time such supplemental indenture will be effective but not operative). 2020 Notes Holders will not be permitted to withdraw validly tendered 2020 Notes and revoke related consents after the execution and delivery of the supplemental indenture, except as may be required by applicable law.

The "2017 Notes Total Consideration" for each U.S.$1,000 principal amount of 2017 Notes validly tendered at or prior to the 2017 Notes Early Tender Date and accepted for purchase pursuant to the 2017 Notes Tender Offer will be U.S.$1,145.00. The 2017 Notes Total Consideration includes an early tender payment equal to U.S.$50.00 for each U.S.$1,000 principal amount of 2017 Notes validly tendered at or prior to the 2017 Notes Early Tender Date and accepted for purchase pursuant to the 2017 Notes Tender Offer (the "2017 Notes Early Tender Payment").  2017 Notes Holders who tender 2017 Notes after the 2017 Notes Early Tender Date but at or prior to the 2017 Notes Expiration Date and whose 2017 Notes are accepted for purchase will not be entitled to receive the 2017 Notes Early Tender Payment and will therefore be entitled to receive, for each U.S.$1,000 principal amount of 2017 Notes tendered, U.S.$1,095.00.

The "2018 Notes Total Consideration" for each U.S.$1,000 principal amount of 2018 Notes validly tendered at or prior to the 2018 Notes Early Tender Date and accepted for purchase pursuant to the 2018 Notes Tender Offer will be U.S.$1,167.50. The 2018 Notes Total Consideration includes an early tender payment equal to U.S.$50.00 for each U.S.$1,000 principal amount of 2018 Notes validly tendered at or prior to the 2018 Notes Early Tender Date and accepted for purchase pursuant to the 2018 Notes Tender Offer (the "2018 Notes Early Tender Payment"). 2018 Notes Holders who tender 2018 Notes after the 2018 Notes Early Tender Date but at or prior to the 2018 Notes Expiration Date and whose 2018 Notes are accepted for purchase will not be entitled to receive the 2018 Notes Early Tender Payment and will therefore be entitled to receive, for each U.S.$1,000 principal amount of 2018 Notes tendered, U.S.$1,117.50.

The "2020 Notes Total Consideration" for each U.S.$1,000 principal amount of 2020 Notes validly tendered at or prior to the 2020 Notes Early Tender Date and accepted for purchase pursuant to the 2020 Notes Tender Offer will be U.S.$1,115.00. The 2020 Notes Total Consideration includes an early tender payment equal to U.S.$50.00 for each U.S.$1,000 principal amount of 2020 Notes validly tendered at or prior to the 2020 Notes Early Tender Date and accepted for purchase pursuant to the 2020 Notes Tender Offer (the "2020 Notes Early Tender Payment"). 2020 Notes Holders who tender 2020 Notes after the 2020 Notes Early Tender Date but at or prior to the 2020 Notes Expiration Date and whose 2020 Notes are accepted for purchase will not be entitled to receive the 2020 Notes Early Tender Payment and will therefore be entitled to receive, for each U.S.$1,000 principal amount of 2020 Notes tendered, U.S.$1,065.00 (the "2020 Notes Tender Offer Consideration"). 2020 Notes Holders who tender their 2020 Notes must consent to the 2020 Proposed Amendments and 2020 Notes Holders cannot deliver consents to the 2020 Proposed Amendments without tendering the related 2020 Notes.

Subject to the 2020 Notes Maximum Tender Amount and the other terms and conditions described in the Offer Documents (as defined below), the Offeror intends to accept for purchase all 2020 Notes validly tendered at or prior to the 2020 Notes Early Tender Date, and will only prorate such 2020 Notes if the aggregate principal amount of 2020 Notes validly tendered at or prior to the 2020 Notes Early Tender Date exceeds the 2020 Notes Maximum Tender Amount. If the 2020 Notes Tender Offer is not fully subscribed to the 2020 Notes Maximum Tender Amount as of the 2020 Notes Early Tender Date, (i) 2020 Notes Holders who validly tender 2020 Notes after the 2020 Notes Early Tender Date may still be subject to proration and (ii) and 2020 Notes Holders who validly tendered 2020 Notes at or prior to the 2020 Notes Early Tender Date and whose 2020 Notes were accepted for purchase on the early settlement date of the 2020 Notes Tender Offer will not be subject to such proration.  Furthermore, if the 2020 Notes Tender Offer is fully subscribed to the 2020 Notes Maximum Tender Amount as of the 2020 Notes Early Tender Date, 2020 Notes Holders who validly tender 2020 Notes after the 2020 Notes Early Tender Date will not have any of their 2020 Notes accepted for purchase, provided that such 2020 Notes may be accepted for purchase if the Offeror increases the 2020 Notes Maximum Tender Amount, which the Offeror is entitled to do in its sole discretion.  There can be no assurance that the Offeror will increase the 2020 Notes Maximum Tender Amount.

Braskem Finance has consented to the Offeror making the Tender Offers and the 2020 Notes Consent Solicitation. Braskem Finance is not making the Tender Offers or the 2020 Notes Consent Solicitation.  It is intended that the Notes purchased by the Offeror pursuant to the Tender Offers will be sold by the Offeror to Braskem Finance, to be paid for with the net proceeds from Braskem Finance's recently announced financing transaction (the "Financing Transaction"). In connection with such sale, the Offeror will deliver consents to the 2020 Proposed Amendments with respect to the aggregate principal amount of 2020 Notes so transferred to Braskem Finance. The intended purpose of these transactions is for Braskem to lengthen and smooth its debt maturity profile.

The obligation of the Offeror to purchase Notes in the Tender Offers is conditioned on the satisfaction or waiver of certain conditions described in the Offer Documents, including the financing agreement in connection with the Financing Transaction has not been terminated prior to the applicable settlement date. None of the Tender Offers are conditioned upon the tender of any minimum principal amount of any series of Notes. However, the 2020 Notes Tender Offer is limited to the 2020 Notes Maximum Tender Amount. The Offeror has the right, in its sole discretion, to amend or terminate any of the Tender Offers and the 2020 Notes Consent Solicitation at any time. 

The terms and conditions of the Tender Offers and the 2020 Notes Consent Solicitation, as well as the 2020 Proposed Amendments, are described in the Offeror's Offer to Purchase and Consent Solicitation Statement, dated April 16, 2014, and the related Letter of Transmittal and Consent (together, the "Offer Documents").  Copies of the Offer Documents are available to holders of Notes from D.F. King & Co., Inc., the information agent for the Tender Offers and the 2020 Notes Consent Solicitation (the "Information Agent").  Requests for copies of the Offer Documents should be directed to the Information Agent at +1 (800) 967-7635 (toll free), +1 (212) 269-5550 (collect) or Braskem@dfking.com.

The Offeror reserves the right, in its sole discretion, not to accept any tenders of Notes or deliveries of consents for any reason.  The Offeror is making the Tender Offers and the 2020 Notes Consent Solicitation only in those jurisdictions where it is legal to do so. 

The Offeror, BB Securities Ltd. ("BB Securities"), Banco BTG Pactual S.A.—Cayman Branch ("BTG Pactual"), Morgan Stanley & Co. LLC ("Morgan Stanley") and Standard Chartered Bank ("Standard Chartered"), have been engaged to act as Dealer Managers and Solicitation Agents in connection with the Tender Offers and the 2020 Notes Consent Solicitation, and Mitsubishi UFJ Securities (USA), Inc. has been engaged to act as Co-Dealer Manager in connection with the Tender Offers and the 2020 Notes Consent Solicitation.  Questions regarding the Tender Offers and the 2020 Notes Consent Solicitation may be directed to the Offeror, BB Securities, BTG Pactual, Morgan Stanley or Standard Chartered at their telephone numbers set forth on the back cover of each of the Offer Documents.

Neither the Offer Documents 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 Documents 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.  The Tender Offers and the 2020 Notes Consent Solicitation are being made solely by the Offeror pursuant to the Offer Documents.  The Tender Offers and the 2020 Notes Consent Solicitation are not being made to, nor will the Offeror accept tenders of Notes and deliveries of consents from, holders in any jurisdiction in which the Tender Offers and the 2020 Notes Consent Solicitation or the acceptance thereof would not be in compliance with the securities or blue sky laws of such jurisdiction.

Braskem S.A.
Danilo Dias Garcez    
Finance Director     
Phone: (+55 11) 3576 9952   
danilo.garcez@braskem.com

Marina Dalben
Structured Finance
Phone: (+55 11) 3576 9716
marina.dalben@braskem.com

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 Braskem Finance and the Offeror that may cause the actual results to be materially different from any future results expressed or implied in such forward-looking statements. Although Braskem Finance believes that the expectations and assumptions reflected in the forward-looking statements are reasonable based on information currently available to Braskem Finance's management, Braskem Finance cannot guarantee future results or events. Braskem Finance expressly disclaims a duty to update any of the forward-looking statements.

SOURCE Braskem Finance Limited

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