Avon Products, Inc. (NYSE:AVP) has announced that its subsidiary Avon International Operations, Inc. is planning to issue out senior secured notes.
The subsidiary plans to issue senior secured notes whose principal aggregate amount is $400 million. Avon Products will guarantee the notes together with its current and future domestic subsidiaries that act as a guarantor under the ongoing credit arrangement as of June 5, 2015. The senior secured notes involved in the upcoming offer will be due in 2022. Reports indicate that the notes will be secured ratably and equally by the issuer’s assets and its subsidiaries that secured the first rights to the revolving credit facility.
Avon plans to combine the revenue from the securities offering to with its cash on hand so that it can complete the tender offering for various series of the firm’s existing senior notes. The company will launch the tenders at the same time that it launches the senior notes offering. According to Avon’s statement on the matter, the secured notes will be available and sold to qualified institutional buyers in the US as long as they are within the provisions of Rule 144A. They will also be offered to pursuants outside the United States through Regulation S and indicated in the U.S. Securities Act of 1933, and its amendments.
The statement also revealed that the senior secured notes will not be registered under the securities act. They might also not be available for sale to buyers in the US unless the buyers are registered under the securities act, or in cases where they are exempted from such registration. Despite the release of the news about the subsidiary’s intention to provide the notes through an offering, the actual date of the offering was not disclosed. The company is also yet to reveal further details about the offer. Nonetheless, it will most likely keep the public informed of any developments regarding the offering to make sure that potential buyers are well informed.