FAIRLAWN, Ohio, April 20 /PRNewswire-FirstCall/ -- OMNOVA Solutions Inc. (the "Company"), announced today that it commenced a cash tender offer to purchase any and all of its outstanding 11-1/4% senior secured notes due 2010 (CUSIP No. 682129AC5) (the "Notes"). The aggregate principal amount of the Notes outstanding is $165 million as of the date of this news release. In conjunction with the tender offer, the Company is soliciting noteholder consents (the "Consents") to effect certain amendments to the indenture governing the Notes to eliminate substantially all of the restrictive covenants. The tender offer is scheduled to expire at 8:00 a.m., New York City time, on May 18, 2007, unless extended or earlier terminated (the "Expiration Date"). The consent solicitation will expire at 5:00 p.m., New York City time, on May 3, 2007, unless extended or earlier terminated (the "Consent Date"). The tender offer is conditioned upon the consummation of a new term loan of approximately $150 million to be entered into on or prior to the Expiration Date and the amendment of, and additional borrowings under, the Company's existing senior secured credit facility, as well as other general conditions. The tender offer is being made pursuant to an Offer to Purchase and Consent Solicitation Statement dated April 20, 2007 (the "Offer to Purchase"), which sets forth more fully the terms and conditions of the tender offer and consent solicitation.
Assuming the payment date for Notes purchased in the tender offer is before June 1, 2007, the purchase price for each $1,000 principal amount of Notes tendered and accepted for payment pursuant to the tender offer will be determined at 2:00 p.m., New York City time, on the tenth business day prior to the Expiration Date, which price determination date is expected to be May 4, 2007, in the manner described in the Offer to Purchase. The purchase price will be announced by news release promptly after its determination. The total consideration per $1,000 principal amount of Notes validly tendered and not withdrawn prior to 5:00 p.m., New York City time, on the Consent Date will be calculated based on the present value on the payment date of the sum of $1,056.25 (the redemption price for the Notes on June 1, 2007, which is the earliest redemption date for the Notes) plus interest payments through June 1, 2007, determined using a discount factor equal to the yield on May 4, 2007 of the 3.500% U.S. Treasury Note due May 31, 2007, plus a fixed spread of 50 basis points, less accrued and unpaid interest to, but not including, the payment date. If the payment date for the Notes purchased in the tender offer is on or after June 1, 2007, the purchase price will be $1,060.94, which represents the redemption price on June 1, 2007, plus the equivalent of two weeks of interest.
Holders who tender on or prior to the Consent Date will receive the total consideration described above, which includes a $30 consent payment per $1,000 principal amount of Notes. Holders who tender after the Consent Date and on or prior to the Expiration Date will receive the total consideration minus the $30 consent payment. In either case, the Company will pay Holders of record on May 15, 2007 whose Notes are validly tendered and accepted for purchase accrued and unpaid interest up to, but not including, the payment date. Payments are expected to be made promptly on or after the Expiration Date. The Company has retained Deutsche Bank Securities Inc. to serve as the Dealer Manager for the tender offer and the consent solicitation. Questions concerning the terms of the tender offer may be directed to Deutsche Bank Securities Inc. at (212) 250-5655 (call collect). Copies of the Offer to Purchase may be obtained by calling the information agent, MacKenzie Partners, Inc., toll-free at (800) 322-2885.
This announcement is not an offer to purchase, a solicitation of an offer to purchase or a solicitation of consents with respect to any securities. The tender offer and consent solicitation are being made solely by the Offer to Purchase.
Cautionary Statement on Forward-Looking Statements
This news release contains statements concerning trends and other forward- looking information affecting or relating to the Company and its industries. These statements are intended to qualify for the protections afforded forward- looking statements under the Private Securities Litigation Reform Act of 1995. Forward-looking statements may generally be identified by the use of forward- looking terms such as "may," "should," "projects," "forecasts," "seeks," "believes," "expects," "anticipates," "estimates," "intends," "plans," "targets," "optimistic", "likely," "will," "would," "could," or similar terms. Forward-looking statements address the Company's business, results of operations, financial condition, significant accounting policies and management judgments, among other things, and include statements based on current expectations, estimates, forecasts and projections. There are many risks and uncertainties that could cause actual results or outcomes to differ materially from those described in the forward-looking statements, some of which are beyond the Company's control, including inherent economic risks, changes in prevailing governmental policies and regulatory actions, and litigation risks inherent in the Company's business.
For further information on these and other risks and uncertainties, see OMNOVA's Securities and Exchange Commission ("SEC") filings, including the Company's Annual Report on Form 10-K for its fiscal year ended November 30, 2006. Copies of this document as well as other SEC filings can be obtained from the Company's website at http://www.omnova.com/. OMNOVA Solutions assumes no obligation to publicly update or revise any forward-looking statements made herein or any other forward-looking statements made by the Company, whether as a result of new information, future events or otherwise.
OMNOVA Solutions Inc. is a technology-based company with 2006 sales of approximately $700 million and a current workforce of 1,700 employees worldwide. OMNOVA is an innovator of emulsion polymers, specialty chemicals, and decorative and functional surfaces for a variety of commercial, industrial and residential end uses. Visit OMNOVA Solutions on the internet at http://www.omnova.com/.
