Cell C (Pty) Limited Announces Offer to Purchase, a Consent Solicitation and an Asset Sale Offer, in respect of its Dollar-Denominated Senior Subordinated Notes Due 2015
May 20, 2011 — Cell C (Pty) Limited announced today that it is offering to purchase for cash any and all of its outstanding $270,000,000 11% Senior Subordinated Notes due 2015. Cell C is also soliciting consents from holders of the Notes to certain proposed amendments to the indenture governing the Notes that would eliminate most of the restrictive covenants and certain events of default in the indenture. In addition, by reason of a recently completed asset sale, Cell C is conducting an asset sale offer for up to $138,016,000 in principal amount of the Notes. The asset sale offer will expire on June 20, 2011, and the offer to purchase and consent solicitation will expire on June 21, 2011.
Cell C is currently in discussions with various lenders to obtain bank facilities to fund capital expenditures pursuant to its R4.7 billion capital expenditure programme announced in 2009. Since the issuance of the Notes in 2005, Cell C’s subscriber base, revenues and operating cash flows have increased and, since 2008, its net debt (excluding shareholder loans) expressed in rand has decreased, representing a significant de-leveraging of its capital structure.
Cell C believes that the capital expenditure initiatives and the reorganisation of Cell C’s operations with the aim of becoming a leading provider of mobile telecommunication services in South Africa necessitate a realignment of its capital structure. Cell C views the offer to purchase and related consent solicitation as a significant step in achieving its realignment objectives, and views the offer to purchase as a more efficient way to realign its capital structure than a redemption of the Notes.
This announcement is not an offer to purchase any Notes or a solicitation of an offer to sell any Notes.
For press enquiries:
Karin Fourie, Cell C Public and Media Relations Manager
Telephone number: +27 11 324 4061
Email address: KFourie@cellc.co.za
