CDW Corp Form 8-K Summary
Business Context and Reporting Period
This Current Report on Form 8-K was filed by CDW Corporation on April 20, 2011. The filing discloses the entry into a material definitive agreement regarding a new debt offering and the commencement of a tender offer for existing senior notes.
Key Financial Metrics and Debt Activity
- New Debt Issuance: CDW Escrow Corporation agreed to sell $450,000,000 aggregate principal amount of 8.5% senior notes due 2019.
- Pricing: The new notes were priced at par in a private offering exempt from registration under the Securities Act of 1933.
- Tender Offer: The Company launched a cash tender offer to purchase up to $412,844,000 of outstanding 11.00% Senior Exchange Notes due 2015 and 11.50% / 12.25% Senior PIK Election Exchange Notes due 2015.
- Closing Date: The sale of the new notes is expected to close on May 20, 2011.
Material Changes and Strategic Actions
The filing represents a significant refinancing strategy. The Company is replacing higher-cost debt (11.00% and 11.50%/12.25% notes due 2015) with lower-cost debt (8.5% notes due 2019). Upon the release of the new notes from escrow, all or a portion will be assumed by CDW LLC and CDW Finance Corporation (the Co-Obligors).
Outlook, Risks, and Contingencies
- Closing Conditions: The transaction is subject to customary closing conditions.
- Redemption/Assumption: As of the closing date, the Co-Obligors and/or the Escrow Issuer are expected to assume and/or redeem the notes.
- Regulatory Status: The new notes are not registered under the Securities Act and may not be offered or sold in the United States without registration or an applicable exemption.
Investor Verification Checklist
- Verify the final closing date of the $450 million note issuance (expected May 20, 2011).
- Confirm the total amount of the 2015 notes successfully tendered by holders.
- Review the attached press releases (Exhibits 99.1 and 99.2) for specific terms of the tender offer and pricing details.
- Monitor subsequent filings for the official assumption of the new notes by the Co-Obligors.