CP Ships announces Senior Subordinated Convertible Note offer and consent solicitation
November 07 2005 - 1:55PM
PR Newswire (US)
GATWICK, UK, Nov. 7 /PRNewswire-FirstCall/ -- CP Ships Limited
today announced that it will offer to purchase any and all of its
4% Senior Subordinated Convertible Notes due 2024 and solicit from
holders of Convertible Notes consents to certain amendments to the
indenture governing the Convertible Notes. CP Ships also announced
that, in accordance with the terms and conditions of the
Convertible Notes, the Convertible Notes will become convertible
into shares of CP Ships commencing 5th December 2005. CP Ships is
required to offer to purchase the Convertible Notes under the
indenture governing the Convertible Notes as a result of the
acquisition by TUI AG, through its indirect wholly-owned subsidiary
Ship Acquisition Inc, of 88.97% of the common shares of CP Ships
under its offer for common shares dated 30th August 2005. Offer and
Consent Solicitation CP Ships will offer to purchase any and all of
its US $200 million aggregate principal amount of 4% Senior
Subordinated Convertible Notes due 2024 for cash equal to 100% of
the principal amount thereof plus accrued and unpaid interest to
but excluding the date of purchase. CP Ships will also seek the
consent of holders of the Convertible Notes to amendments to the
indenture governing the Convertible Notes that would eliminate
certain reporting obligations and restrictive covenants as well as
certain events of default and related provisions. CP Ships will pay
holders of Convertible Notes US $2.50 for each US $1,000 principal
amount of Convertible Notes in respect of which they deliver
consents, provided that CP Ships receives consents from holders
representing at least the majority in aggregate principal amount of
the Convertible Notes outstanding. The offer is not conditional on
the successful completion of the consent solicitation. The offer
will expire at 5:00 p.m. (New York time) on 14th December 2005,
unless required to be extended, and is subject to the condition
that there be no default or event of default existing under the
indenture governing the Convertible Notes. Assuming satisfaction of
the condition of the offer, CP Ships expects to pay for Convertible
Notes properly deposited under the offer and not withdrawn on 19th
December 2005. The consent solicitation will expire at 5:00 p.m.
(New York time) on 16th December 2005, unless extended, and is
subject to the condition that CP Ships receives consents from
holders representing at least the majority in aggregate principal
amount of the Convertible Notes outstanding prior to the expiry of
the consent solicitation. Assuming satisfaction of the condition of
the consent solicitation, CP Ships expects to pay for consents
received and not revoked on 19th December 2005. This press release
is neither an offer to purchase nor a solicitation of an offer to
sell the Convertible Notes. Full particulars of the offer and
consent solicitation, including the terms thereof and a more
detailed description of the proposed amendments to the indenture
governing the Convertible Notes, will be contained in documentation
to be mailed to holders of Convertible Notes on or about 8th
November 2005. At the time the offer is commenced, CP Ships will
file with the United States Securities and Exchange Commission a
Tender Offer Statement, and the documentation relating to the offer
and consent solicitation will be filed with the Canadian securities
commissions and the United States Securities and Exchange
Commission. These will contain important information about CP
Ships, the offer and consent solicitation and other related
matters, and holders of Convertible Notes are urged to read each of
these documents carefully when they are available. Investors and
holders of Convertible Notes will be able to obtain a free copy of
the documentation (when available) at the Canadian SEDAR web site
at http://www.sedar.com/ and at the SEC's web site at
http://www.sec.gov/. None of CP Ships, the Board of Directors of CP
Ships, the trustee of the Convertible Notes or the dealer managers
for the offer and solicitation are making any recommendation to
holders of Convertible Notes as to whether to deposit their
Convertible Notes under the offer or consent to the amendments to
the indenture governing the Convertible Notes. For additional
information or assistance, holders of Convertible Notes may contact
their broker, dealer, bank, trust company or other nominee through
which their Convertible Notes are held. Holders of Convertible
Notes may also contact the dealer managers for the offer and
consent solicitation, Citigroup Global Markets Canada Inc (in
Canada) at (212) 723-7450 and Citigroup Global Markets Inc (in the
United States) at (212) 723-7450 or the information agent,
Mackenzie Partners, Inc, at 800-322-2885. Commencement of
Conversion Period CP Ships also announced today that it has called
for 14th December 2005 a special meeting of its shareholders to
consider and, if deemed advisable, approve the amalgamation of CP
Ships and Ship Acquisition Inc. The amalgamation will result in TUI
owning 100% of the common shares of the company resulting from the
amalgamation, which will also be called CP Ships Limited. Holders
of common shares of CP Ships immediately prior to the amalgamation,
other than Ship Acquisition Inc, will receive one redeemable
special share of CP Ships (as the corporation resulting from the
amalgamation) per common share held. Subject to applicable law, the
special shares will immediately be redeemed for US $21.50 per
share, the same price per share paid under the TUI offer for CP
Ships common shares dated 30th August 2005. Ship Acquisition Inc.
holds a sufficient number of common shares of CP Ships to approve
the amalgamation in accordance with applicable law. The board of
directors of CP Ships has determined that the anticipated effective
date of the amalgamation is 20th December 2005. The board of
directors has also determined that, following the amalgamation, CP
Ships (as the corporation resulting from the amalgamation) will
satisfy its obligation to deliver shares upon the conversion of the
Convertible Notes by delivery of one redeemable special share of CP
Ships, in lieu of each common share deliverable immediately prior
to the amalgamation, subject to adjustment in accordance with the
terms of the indenture governing the Convertible Notes. The terms
and conditions of the redeemable special shares will require that,
subject to applicable law, CP Ships redeem any such shares
immediately following their issuance for US $21.50 per share. The
current conversion rate is 39.6542 shares per US $1,000 aggregate
principal amount of Convertible Notes, subject to adjustment in
certain circumstances. CP Ships has the option to deliver cash in
lieu of shares issuable upon any conversion of the notes, provided
no event of default exists under the indenture. In accordance with
their terms and conditions, the Convertible Notes will become
convertible commencing 5th December 2005 and ending 15 days
following the effective date of the amalgamation, such 15 day
period is expected to end 4th January 2006. About CP Ships CP
Ships, a subsidiary of TUI AG, provides international container
transportation in four key regional markets: TransAtlantic,
Australasia, Latin America and Asia with 38 services in 21 trade
lanes. As of 30th September 2005 its vessel fleet was 80 ships and
its container fleet 432,000 teu. Volume in 2004 was 2.3 million
teu. CP Ships also owns Montreal Gateway Terminals which operates
one of Canada's largest marine container terminal facilities. CP
Ships is listed on the Toronto and New York Stock Exchanges. TUI
intends to acquire 100% of CP Ships by the end of 2005 after which
CP Ships is expected to no longer be a public company. TUI plans to
integrate CP Ships into its other shipping subsidiary Hapag-Lloyd
to create the world's fifth-largest container shipping company.
Forward Looking Information This press release contains certain
forward-looking information and statements within the meaning of
applicable securities laws relating, but not limited, to
operations, anticipated or prospective financial performance,
results of operations, business prospects and strategies of CP
Ships. Forward- looking information typically contains statements
with words such as "consider," "anticipate," "believe," "expect,"
"plan," "intend," "likely" or similar words suggesting future
outcomes or statements regarding TUI's ability to integrate
successfully CP Ships' operations and employees and ability to
realize anticipated synergies and regarding an outlook on future
changes in volumes, freight rates, costs, achievable cost savings,
the estimated amounts and timing of capital expenditures,
anticipated future debt levels and incentive fees or revenue, or
other expectations, beliefs, plans, objectives, assumptions,
intentions or statements about future events or performance. These
statements are subject to known and unknown risks, uncertainties
and other factors that could cause actual results to differ
materially from those suggested by the forward-looking statements.
Although CP Ships believes it has a reasonable basis for making the
forecasts or projections included herein, you are cautioned not to
place undue reliance on such forward-looking information. By its
nature, the forward-looking information involves numerous
assumptions, inherent risks and uncertainties, both general and
specific that contributes to the possibility that the predictions,
forecasts and other forward-looking statements will not occur.
These factors include, but are not limited to, changes in business
strategies; the effects of competition and pricing pressures;
changes in freight rates; changes in operational costs; industry
over-capacity; changes in demand for container shipping;
congestion; availability and cost of chartered ships; changes in
laws and regulations, including tax, environmental, employment,
competition, anti-terrorism and trade laws; and the company's
anticipation of and success in managing the risks associated with
the foregoing. The above list of important factors affecting
forward-looking information is not exhaustive, and reference should
be had to the other risks discussed in filings with securities
regulators. CP Ships undertakes no obligation, except as required
by law, to update publicly or otherwise revise any forward-looking
information, whether as a result of new information, future events
or otherwise, or the above list of factors affecting this
information. DATASOURCE: CP Ships CONTACT: Investors: Jeremy Lee,
VP Investor Relations and Public Affairs, Telephone: (514)
934-5254; Media: Elizabeth Canna, VP Group Communications,
Telephone: +44 (0)1293 861 921 or +41 (0)79 691 3764
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