SACRAMENTO, Calif., April 25, 2018 /PRNewswire/ -- McClatchy (NYSE American: MNI) announced that The State Media Company completed the sale of real property including The State building and surrounding land. Concurrent with the sale, McClatchy entered into a 15-year lease with the purchaser of the real property, which includes initial annual lease payments of approximately $1.6 million.
The sale resulted in $13.0 million of after-tax proceeds to the company. McClatchy is offering all $13.0 of after-tax proceeds to holders of its 9.0% Senior Secured Notes due in 2022 (the "9.0% Notes") in compliance with the indenture for the 9.0% Notes pursuant to the Offer described below.
The indenture for McClatchy's 9.0% Notes requires it to make a cash offer at par using the after-tax proceeds from the sale to the extent that the proceeds are not reinvested within 365 days of the closing of the transaction. Accordingly, McClatchy has today commenced an offer to purchase for cash up to $13.0 million of the outstanding 9.0% Notes at par plus accrued and unpaid interest to the settlement date. The terms and conditions of the offer are set forth in the Offer to Purchase dated April 25, 2018 (the "Offer" or "Offer to Purchase") and Letter of Transmittal (the "Letter of Transmittal"). The Offer is not subject to the receipt of any minimum amount of 9.0% Notes tendered, but is subject to the general conditions set forth in the Offer to Purchase. The Offer is scheduled to expire on May 22, 2018.
Based on recent market quotations for the 9.0% Notes, the 9.0% Notes were trading at premium prices ranging between 104.250 percent and 104.875 percent of par. However, holders of the 9.0% Notes should check with dealers of the 9.0% Notes to obtain current pricing on the 9.0% Notes.
To the extent the 9.0% Notes are not repurchased under the Offer, management may use the proceeds to invest in initiatives and/or investments to continue its digital transformation, to selectively repurchase outstanding Notes or for other corporate purposes as determined by management and the Board of Directors.
This press release is neither an offer to purchase, nor a solicitation for acceptance of the Offer. The McClatchy Company is making the Offer only by, and pursuant to the terms of, the Offer to Purchase and the related Letter of Transmittal.
The complete terms and conditions of the Offer are set forth in the Offer to Purchase and Letter of Transmittal that are being sent to holders of the Notes. Holders are urged to read the tender offer documents carefully when they become available. Copies of the Offer to Purchase and Letter of Transmittal may be obtained from the Tender and Paying Agent for the Offer, Bank of New York Mellon Trust Company, N.A., at 1-800-254-2826 (US toll-free).
McClatchy operates 30 media companies in 14 states, providing each of its communities with high-quality news and advertising services in a wide array of digital and print formats. McClatchy is a publisher of iconic brands such as the Miami Herald, The Kansas City Star, The Sacramento Bee, The Charlotte Observer, The (Raleigh) News & Observer, and the (Fort Worth) Star-Telegram. McClatchy is headquartered in Sacramento, Calif., and listed on the New York Stock Exchange American under the symbol MNI.