Cott Announces Closing of $525 Million 5.375% Senior Note Offering,
Results to Date of Tender Offer and Consent Solicitation and Notice
of Intent to Redeem the Remaining Outstanding 8.125% Senior Notes
Due 2018
TORONTO, ON and TAMPA, FL--(Marketwired - Jun 24, 2014) -
Consistent with Cott Corporation's (NYSE: COT) (TSX: BCB) recently
announced strategic priorities, Cott announced today that its
wholly owned subsidiary, Cott Beverages Inc. ("Cott Beverages"),
has closed its private placement of $525 million in aggregate
principal amount of 5.375% senior notes due 2022 (the "New Notes"),
resulting in net proceeds to Cott Beverages of approximately $517
million.
As announced on Cott's first quarter earnings call, Cott's five
strategic priorities are:
1. Continue with our 4C's approach including our tight operating
management and capital controls with an ongoing focus on cash
generation.
2. Increase our allocation of new and dedicated resources
against our growth in contract manufacturing with a three year
target of adding 50 to 80 million 8oz equivalent cases to our North
American contract manufacturing channel which includes incremental
contract manufacturing growth of between 15 and 18 million 8oz
equivalent cases in 2014.
3. Refinance our 8.125% senior notes due 2018 (the "2018 Notes")
in parallel with an expansion of our overall debt capacity but at
the same time reduce our interest rate. The refinancing of our
2018 Notes and the issuance of the New Notes will result in an
approximate $2 million reduction in interest costs per annum.
4. Based on our current view of the operating environment,
increase our return of funds to shareholders to up to 50% of our
free cash flow over the next 12 months via an increase in our
opportunistic share repurchase plan and the continuance of our 6
cents quarterly dividend that is now denominated in US
currency.
5. Accelerate in pace and scale our diversifying acquisitions
outside of carbonated soft drinks and shelf stable juices, with a
focus on other beverage categories and beverage adjacencies, as
well as on driving our channel mix beyond large format retail and
supermarket stores. In line with this priority, our United
Kingdom / Europe Business Unit recently acquired Aimia Foods
(Holdings) Limited, which further improves our product, package and
channel diversification by expanding our product line into the
foodservice channel to include hot chocolate, coffee, malt drinks,
creamers/whiteners and cereals, and by providing us with new
packaging formats, which include pouches, jars, sticks, in-cup
products, sachets and block-bottom bags.
The New Notes have not been registered under the Securities Act
of 1933, as amended (the "Securities Act"), or any state securities
laws and, unless so registered, may not be offered or sold in the
United States except pursuant to an applicable exemption from the
registration requirements of the Securities Act and applicable
state securities laws.
Cott also announced today that Cott Beverages has accepted for
purchase $295,929,000 million aggregate principal amount of the
2018 Notes, or 78.91% of the total outstanding, which were validly
tendered prior to 5:00 p.m., New York City time, on June 23, 2014
(the "Consent Expiration"), pursuant to Cott Beverages' previously
announced cash tender offer and consent solicitation (the "Tender
Offer"). Holders of Notes accepted for purchase will receive the
"Total Consideration" of $1,054.63, plus accrued and unpaid
interest to, but not including, the initial settlement date for the
Tender Offer, which is today. Cott Beverages expects to use the net
proceeds from the offering of the New Notes to repurchase the 2018
Notes tendered in the Tender Offer, to redeem any of the 2018 Notes
that remain outstanding, to repay any outstanding loans under its
asset-based lending credit facility, to pay related fees and
expenses and for general corporate purposes.
Cott also announced that Cott Beverages has received consents
(coupled with tenders) from holders representing a majority of the
outstanding principal amount of the 2018 Notes to adopt the
proposed amendments to the 2018 Notes. A supplemental indenture
effecting the proposed amendments has been executed, but such
proposed amendments will only become operative simultaneously upon
the acceptance for payment of all 2018 Notes that are validly
tendered (and not previously withdrawn).
The Tender Offer will expire at 11:59 p.m., New York City time,
on July 8, 2014, unless extended or earlier terminated (the
"Expiration Time"). Holders who tender their 2018 Notes prior to
the Expiration Time will be eligible to receive consideration equal
to $1,024.63, plus any accrued and unpaid interest on the 2018
Notes up to, but not including, the final payment date for the
Tender Offer, which is expected to be July 9, 2014.
In addition, Cott Corporation announced today that Cott
Beverages gave notice to Wells Fargo Bank, National
Association ("Wells Fargo"), the trustee under the indenture
governing the 2018 Notes, of its intent to redeem the remaining
outstanding 2018 Notes following the Expiration Time at a
redemption price equal to 100% of the aggregate principal amount of
the 2018 Notes to be redeemed, a make-whole premium, and accrued
and unpaid interest on the principal amount being redeemed to, but
not including, the redemption date. The redemption date will be
July 24, 2014.
Cott Beverages has instructed Wells Fargo to send a notice of
redemption on June 24, 2014 in the name of Cott Beverages, which
contains additional information concerning the terms and conditions
of the redemption, to all currently registered holders of the 2018
Notes.
This press release is for informational purposes only and is not
an offer to buy or the solicitation of an offer to sell with
respect to any securities. The tender offer and consent
solicitation are only being made pursuant to the terms of the Offer
to Purchase and Consent Solicitation Statement and the related
Letter of Instructions. The Tender Offer is not being made in any
jurisdiction in which the making or acceptance thereof would not be
in compliance with the securities, blue sky or other laws of such
jurisdiction. None of Cott Beverages, the dealer manager, the
solicitation agent, the information agent, the depositary or their
respective affiliates is making any recommendation as to whether or
not holders should tender all or any portion of their Notes in the
tender offer or deliver their consent to the proposed
amendments.
Cott Beverages has retained BofA Merrill Lynch to act as sole
dealer manager and solicitation agent for the tender offer and
consent solicitation and D.F. King & Co., Inc. to act as
information agent and depositary for the tender offer. Requests for
documents may be directed to D.F. King & Co., Inc. at (800)
848-3416 (toll free) or (212) 269-5550 (collect). Questions
regarding the tender offer or consent solicitation may be directed
to BofA Merrill Lynch at (888) 292-0070 (toll free) or (980)
388-3646 (collect).
Safe Harbor
Statements This press release contains forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933 and Section 21E of the Securities Exchange Act of 1934,
including statements regarding Cott's strategic priorities, the
completion of the tender offer, and the Total Consideration or
Tender Consideration, as applicable, to be paid to holders of the
2018 Notes who tender their 2018 Notes prior to the Consent
Expiration or prior to the Expiration Time, as applicable, and the
redemption of the 2018 Notes. Forward-looking statements involve
inherent risks and uncertainties and Cott cautions you that a
number of important factors could cause actual results to differ
materially from those contained in any such forward-looking
statement. The forward-looking statements are based on assumptions
regarding management's current plans and estimates. Management
believes these assumptions to be reasonable but there is no
assurance that they will prove to be accurate. Factors that could
cause actual results to differ materially from those described in
this press release include those risks and uncertainties indicated
from time to time in Cott's filings with the Securities and
Exchange Commission. Readers are cautioned not to place undue
reliance on any forward-looking statements, which speak only as of
the date hereof. Readers are urged to carefully review and consider
the various disclosures, including but not limited to risk factors
contained in Cott's Annual Report on Form 10-K and its quarterly
reports on Form 10-Q, as well as other periodic reports filed with
the securities commissions. Cott does not undertake to update or
revise any of these statements in light of new information or
future events, except as expressly required by applicable law.
CONTACT: Jarrod
Langhans Investor Relations Tel: (813) 313-1732 Email Contact
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