NEW YORK, Feb. 1 /PRNewswire/ -- American Media Operations, Inc. (the "Company") announced today it had completed its financial restructuring with the successful completion of the cash tender offers for its outstanding senior subordinated notes (the "Tender Offers") and receipt of requisite consents in the related consent solicitations (the "Consent Solicitations") in respect of an aggregate of approximately $570 million of its outstanding senior subordinated notes, consisting of (1) $414,544,000 aggregate principal amount of 10 1/4% Series B Senior Subordinated Notes due 2009 (collectively, the "2009 Notes") and (2) $155,454,000 aggregate principal amount of 8 7/8% Senior Subordinated Notes due 2011 (collectively, the "2011 Notes" and, together with the 2009 Notes, the "Existing Notes").
The Tender Offer and Consent Solicitation expired at 8:00 a.m., New York City time, on January 29, 2009 (the "expiration time"). Approximately 96.6% of the 2009 Notes and 95.2% of the 2011 Notes were validly tendered and accepted for payment and consents were delivered with respect to all such Existing Notes. Holders who tendered 2009 Notes received total consideration equal to $807.56 for each $1,000 principal amount of 2009 Notes validly tendered and not validly withdrawn. Holders who tendered 2011 Notes received total consideration equal to $756.32 for each $1,000 principal amount of 2011 Notes validly tendered and not validly withdrawn.
The Company also received the requisite consents in the related Consent Solicitations in order to execute and deliver the supplemental indentures to effect the proposed amendments to the Existing Notes and the indentures pursuant to which the Existing Notes were issued.
The Company also completed today its private placement of $21,245,380 of 9% Senior PIK Notes due 2013 and $300,000,000 of 14% Senior Subordinated Notes due 2013 and the Company's parent, American Media, Inc. ("AMI") completed its offering of 5,694,480 shares of its common stock.
With the successful completion of these transactions, the Company's bondholders now own 95% of AMI's common stock and the Company's debt has been reduced by $227.2 million.
The Company's Chairman and CEO David J. Pecker said, "This is a major step forward for American Media. We now have the capital structure in place to strategically, financially and operationally fully realize the potential of our brands. We will continue to balance our future investments with a disciplined financial mindset to maximize the return for our company."
This release is for informational purposes only and is neither an offer to purchase nor a solicitation of an offer to sell any securities.
About American Media, Inc.
American Media, Inc. is the leading publisher of celebrity journalism and health and fitness magazines in the U.S. These include Star, Shape, Men's Fitness, Fit Pregnancy, Natural Health, and The National Enquirer. In addition to print properties, AMI owns Distribution Services, Inc., the country's #1 in-store magazine merchandising company.
This press release contains "forward¿looking statements," within the meaning of the federal securities laws that involve risks and uncertainties. All statements herein that address activities, events or developments that AMI or AMOI expect or anticipate will or may occur in the future, including estimates of financial performance and such things as business strategy, measures to implement strategy, competitive strengths, goals, references to future success and other events, are generally forward¿looking statements.
AMI's actual results may differ materially from its estimates. Whether actual results, events and developments will conform to AMI's expectations is subject to a number of risks and uncertainties and important factors, many of which are beyond AMI's control. Among the risks and uncertainties which could cause AMI's actual results to differ from those contemplated by its forward¿looking statements are the risk that AMI may not be able to refinance its debt; AMI may not be able to successfully develop its magazine operations so that they continue to generate sufficient cash flow to enable AMOI to meet its obligations under its senior credit facility and bond indentures, including the financial covenants under its senior credit facility; AMOI may not be able to comply with covenant requirements in its agreements with its lenders and in its indentures; AMOI may not be able to implement and maintain an effective system of internal controls over financial reporting; actions of rating agencies; industry and general economic conditions; AMI may not be able to realize its expected benefits from cost savings and revenue enhancement initiatives; and the risks and uncertainties contained in AMOI 's periodic reports filed with the Securities and Exchange Commission. Consequently, all forward¿looking statements made herein are qualified by these cautionary statements and there can be no assurance that the results, events or developments referenced herein will occur or be realized.
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