Business & Finance
Business and Finance
Business and Finance
Tue, January 6, 2009
Mon, January 5, 2009 PNM Resources Announces Tender Offer for Portion of Senior Notes
ALBUQUERQUE, N.M.--([ BUSINESS WIRE ])--PNM Resources (NYSE: PNM) today announced the commencement of a modified "Dutch Auction" tender offer (the "Tender Offer") for a portion of its outstanding 9.25% Senior Notes, Series A, due 2015 (the "Notes").
PNM Resources is offering to purchase up to $150,000,000 (the "Tender Cap") aggregate principal amount of the Notes in accordance with the modified Dutch Auction procedures described below. As of Jan. 4, 2009, $350,000,000 aggregate principal amount of Notes were outstanding.
The Tender Offer is contingent on certain conditions, including the closing of the pending sale of the PNM utility gas operations. The $620 million sale to New Mexico Gas Company, Inc. is scheduled to close on Jan. 30, 2009.
The Tender Offer will expire at 9 a.m. New York City time on Feb. 3, 2009, unless extended or earlier terminated by PNM Resources (such date and time, as the same may be extended, the "Expiration Date"). The Tender Offer is subject to the satisfaction of certain conditions as described in the offer to purchase, dated Jan. 5, 2009. Holders of Notes (the "Noteholders") must validly tender and not validly withdraw their Notes on or prior to 5 p.m. New York City time on Jan. 16, 2009, unless extended by PNM Resources (such date and time, as the same may be extended, the "Early Participation Date"), in order to receive the Total Consideration for their Notes.
The "Total Consideration"for each $1,000 principal amount of Notes validly tendered (and not validly withdrawn) pursuant to the Tender Offer on or prior to the Early Participation Date and accepted for purchase by PNM Resources will be equal to the Clearing Price (as defined below). The Total Consideration includes an amount (the "Early Participation Payment") equal to $30 for each $1,000 principal amount of Notes accepted for purchase. Notes tendered may be validly withdrawn at any time prior to 5 p.m. New York City time on Jan. 16, 2009, unless extended by PNM Resources (such date and time, as the same may be extended, the "Withdrawal Date"),but not thereafter.
The Tender Offer is being conducted as a modified "Dutch Auction." This means that Noteholders who elect to participate must specify the price they would be willing to receive in exchange for each $1,000 principal amount of Notes they choose to tender in the Tender Offer. The price that Noteholders specify for each $1,000 principal amount of Notes must be in increments of $2.50, and must be within a range between $830 (the "Minimum Offer Price") and $930 (the "Maximum Offer Price") per $1,000 principal amount of Notes. Holders who do not specify a price will be deemed to have specified a price equal to the Minimum Offer Price in respect of Notes tendered and to accept the Clearing Price determined by PNM Resources in accordance with the terms of the Tender Offer. Tenders of Notes for which a price is specified below the Minimum Offer Price or in excess of the Maximum Offer Price will not be accepted and will not be used for the purpose of determining the Clearing Price. Tenders of Notes not submitted in whole increments of $2.50 will be rounded down to the nearest $2.50 increment.
PNM Resources will accept Notes validly tendered in the order of the lowest to the highest tender prices specified by tendering Noteholders (in increments of $2.50), and will select the single lowest price (the "Clearing Price") per $1,000 principal amount of Notes to enable us to purchase the amount of Notes equal to the $150,000,000 Tender Cap (or, if less than the Tender Cap are validly tendered, all Notes so tendered). The price at which Notes were validly tendered (before the subtraction of the Early Participation Payment with respect to Notes tendered after the Early Participation Date) will be used for the purpose of determining the Clearing Price and proration, as described below. PNM Resources will pay the same price (subject to adjustment, as described below) for all Notes validly tendered and not validly withdrawn at or below the Clearing Price and accepted for purchase in the Tender Offer. The price paid for Notes tendered after the Early Participation Date will be reduced by the Early Participation Payment set out above.
If the aggregate amount of Notes validly tendered at or below the Clearing Price and not validly withdrawn exceeds the Tender Cap, then, subject to the terms and conditions of the Tender Offer, PNM Resources will accept for purchase, first, all Notes validly tendered at prices (in increments of $2.50) below the Clearing Price and, thereafter, the Notes validly tendered at the Clearing Price on a prorated basis according to the principal amount of such Notes. All Notes not accepted as a result of proration and all Notes tendered at prices in excess of the Clearing Price will be rejected from the Tender Offer and will be returned to tendering Noteholders at PNM Resources' expense promptly following the earlier of the Expiration Date or the date on which the Tender Offer is terminated. We will make appropriate adjustments downward to the nearest $1,000 principal amount to avoid purchases of Notes in principal amounts other than integral multiples of $1,000.
Noteholders also will receive accrued and unpaid interest on their Notes, up to, but excluding, the date of payment of the applicable consideration (the "Payment Date"). The Payment Date for the Tender Offer will occur promptly following the Expiration Date.
The terms and conditions of the Tender Offer are described in the offer to purchase, dated, Jan. 5, 2009, and in the related letter of transmittal. Citi, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wedbush Morgan Securities Inc. are the dealer managers for the Tender Offer. Global Bondholder Services Corporation ("GBSC") is the depositary and information agent. Copies of the offer to purchase and related documents may be obtained from GBSC at (866) 873-7700 or (212) 430-3774 (for banks and brokers). Questions regarding the Tender Offer may be directed to Citi at (800) 558-3745, Merrill Lynch, Pierce, Fenner & Smith Incorporated at (888) 654-8637, or Wedbush Morgan Securities Inc. at (213) 688-8091.
This press release does not constitute an offer to purchase or a solicitation of any offer to sell the Notes or any other securities. The Tender Offer is being made solely by the offer to purchase, dated Jan. 5, 2009, and the related letter of transmittal.
Background:
PNM Resources (NYSE: PNM) is an energy holding company based in Albuquerque, N.M., with 2007 consolidated operating revenues from continuing and discontinued operations of $2.4 billion. Through its utility and energy subsidiaries, PNM Resources has more than 2,700 megawatts of generation resources and serves electricity to more than 859,000 homes and businesses in New Mexico and Texas and natural gas to more than 495,000 customers in New Mexico. The company also has a 50-percent ownership of EnergyCo, which owns approximately 920 megawatts of generation. For more information, visit [ www.PNMResources.com ].
