Grupo Famsa, S.A.B. de C.V. Announces the Commencement of an Offer to Exchange Any and All of its 7.250% Senior Notes due 2020 for New 9.75% Senior Secured Notes due 2024

USA - English

• Latin America - español

MONTERREY, Mexico, Oct. 28, 2019 /PRNewswire/ -- Grupo Famsa, S.A.B. de C.V. (the "Issuer") today announced that it is offering to exchange (the "Exchange Offer") newly issued 9.75% Senior Secured Notes due 2024 (the "New Notes") for any and all of its outstanding 7.250% Senior Notes due 2020 (the "Existing Notes").

The Issuer is also conducting a solicitation of consents (the "Consent Solicitation") of the holders of Existing Notes to certain proposed amendments (the "Proposed Amendments") to the indenture governing the Existing Notes (the "Existing Indenture"). The Proposed Amendments would amend the Existing Indenture to eliminate substantially all of the restrictive covenants and certain events of default, among other provisions contained in the Existing Indenture.  The Exchange Offer and Consent Solicitation are being conducted upon the terms and subject to the conditions set forth in the offering memorandum dated October 28, 2019 (as it may be amended or supplemented from time to time, the "Offering Memorandum").

The Exchange Offer and the Consent Solicitation will expire at 11:59 p.m., New York City Time, on November 25, 2019, unless extended or earlier terminated (such time and date with respect to the Exchange Offer, as the same may be extended, the "Expiration Date").   Holders who validly tender Existing Notes by 5:00 p.m., New York City time, on November 8, 2019, unless extended (such time and date with respect to the Exchange Offer, as the same may be extended, the "Early Tender Deadline"), will receive the Total Consideration described below.  Holders who validly tender Existing Notes after the Early Tender Deadline will only receive the Exchange Consideration described below.  Tenders of Existing Notes may be withdrawn and Consents may be revoked prior to 5:00 p.m., New York City Time, on November 8, 2019, but not thereafter, subject to limited exceptions, unless such time is extended (such time and date with respect to the Exchange Offer, as the same may be extended, the "Withdrawal Deadline").

The following table summarizes the material pricing terms for the Exchange Offer:

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Certain Conditions to the Exchange Offer

As described more fully in the Offering Memorandum, the consummation of the Exchange Offer is conditioned upon, among other things, the valid tender, without subsequent withdrawal, of at least US$112,000,000, or 80%, of the outstanding aggregate principal amount of the Existing Notes (the "Minimum Tender Condition") and the delivery of the Requisite Consents (as defined below) at or prior to the Expiration Time and the execution and delivery of the Supplemental Indenture (as defined below) by the parties thereto (the "Requisite Consents Condition"). The Issuer may, at its option and in its sole and absolute discretion, waive such conditions and any other condition that it may assert subject to applicable law.

The Consent Solicitations

The delivery of a consent to the Proposed Amendments by a Holder will constitute a consent to all of the Proposed Amendments. Delivery of consents to the Proposed Amendments by Holders of at least a majority of the aggregate principal amount of the Existing Notes is required for the adoption of the Proposed Amendments with respect to the Existing Notes (the "Requisite Consents"). If the Issuer obtains the Requisite Consents, it will execute a supplement to the Existing Indenture (the "Supplemental Indenture"), which the Issuer expects to execute promptly following the Expiration Date. The Supplemental Indenture will become effective upon execution by the Issuer and The Bank of New York Mellon, as trustee under the Existing Indenture (the "Existing Notes Trustee"), but will provide that the Proposed Amendments will not become operative until the Issuer accepts at least a majority of the aggregate principal amount of the Existing Notes in the Exchange Offer. The Issuer will issue a public announcement if and when the Requisite Consents have been obtained. If the Exchange Offer is terminated or withdrawn, or the Requisite Consents are not obtained but the Exchange Offer is nevertheless consummated, the Existing Indenture will remain in effect in its present form.

General

The New Notes have not been and will not be registered under the Securities Act of 1933, as amended (the "Securities Act") or any state securities laws. The New Notes are being offered and issued only (1) in the United States to holders of Existing Notes that are (a) "Accredited Investors" as defined in Rule 501 under Regulation D or (b) "qualified institutional buyers" as defined in Rule 144A under the Securities Act and (2) outside the United States to holders of Existing Notes that are not U.S. persons in reliance upon Regulation S under the Securities Act (each, an "Eligible Holder" and together, the "Eligible Holders"). Accordingly, the New Notes will be subject to restrictions on transferability and resale and may not be transferred or resold except as permitted under the Securities Act and other applicable securities laws, pursuant to registration or exemption therefrom.

This press release is for informational purposes only and is not an offer of the New Notes for sale in the United States. The New Notes may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and other applicable securities laws. Any public offering of the New Notes to be made in the Unites States will be made by means of a prospectus that may be obtained from the Issuer and that will contain detailed information about the Issuer and its management, as well as financial statements.

The New Notes have not been and will not be registered with the National Securities Registry maintained by the Mexican National Banking and Securities Commission, and may not be offered or sold publicly, or otherwise be the subject of brokerage activities, in Mexico, except pursuant to a private placement exemption set forth under Article 8 of the Ley del Mercado de Valores, as amended (the Mexican Securities Market Law). The acquisition of the New Notes by an investor who is a resident of Mexico will be made under its own responsibility.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offering, solicitation or sale would be unlawful. 

The Exchange Offer and Consent Solicitation are being made solely pursuant to the Offering Memorandum. The Offering Memorandum will be distributed only to holders of Existing Notes that complete and return a letter of eligibility confirming that they are Eligible Holders for the purposes of the Exchange Offer. The website to complete the Eligibility Form is www.dfking.com/famsa. D.F. King & Co., Inc. is acting as the Information Agent for the Exchange Offer. Requests for the Offering Memorandum from Eligible Holders may be directed to D.F. King & Co., Inc. at (212) 269‑5550 (for brokers and banks), (866) 207‑2239 (for all others) or email [email protected].

Neither the Issuer, its board nor any other person makes any recommendation as to whether the holders of the Existing Notes should exchange their notes, and no one has been authorized to make such a recommendation. Holders of the Existing Notes must make their own decisions as to whether to exchange their notes, and if they decide to do so, the principal amount of the notes to exchange.

About Grupo Famsa

Established in 1970 in Monterrey, Nuevo Leon, Mexico, Grupo Famsa is a leading company in the Mexican retail sector, satisfying families' diverse purchasing, financing and savings needs. Its target market is the middle and low-middle income segments of Mexico's population and the Hispanic population in the U.S. states where it operates. Grupo Famsa's Mexican retail operation offers furniture, electronics, household appliances, cellular telephones, computers, motorcycles, clothing and other durable consumer products, which are sold mainly through its Famsa stores. In the states of Texas and Illinois in the United States, Grupo Famsa offers furniture and appliances through its subsidiary, Famsa, Inc.

Forward-Looking Statements

This release may contain forward-looking statements. These forward-looking statements include, without limitation, those regarding the Issuer's future financial position and results of operations, the Issuer's strategy, plans, objectives, goals and targets, future developments in the markets in which the Issuer participates or is seeking to participate or anticipated regulatory changes in the markets in which the Issuer operates or intends to operate. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. The Issuer cautions potential investors that forward-looking statements are not guarantees of future performance and are based on numerous assumptions and that the Issuer's actual results of operations, including the Issuer's financial condition and liquidity may differ materially from (and be more negative than) those made in, or suggested by, any forward-looking statements contained in this release. In addition, even if the Issuer's results of operations, including the Issuer's financial condition and liquidity and the development of the industries in which the Issuer operates, are consistent with the forward-looking statements contained in this release, those results or developments may not be indicative of results or developments in subsequent periods. More detailed information about these and other factors are set forth in the Offering Memorandum.

Contact:
Investor Relations
Paloma E. Arellano Bujanda
[email protected]
+52 (81) 8389-3400 ext. 1419

SOURCE Grupo Famsa, S.A.B. de C.V.

Related Links

http://www.grupofamsa.com/es