MILWAUKEE--(EON: Enhanced Online News)--Joy Global Inc. (NYSE: JOY), a worldwide leader in high-productivity mining solutions, today announced the commencement of a consent solicitation relating to $500,000,000 aggregate principal amount of its 5.125% Senior Notes due 2021 (the “2021 Notes”) and $150,000,000 aggregate principal amount of its 6.625% Senior Notes due 2036 (the “2036 Notes” and, together with the 2021 Notes, the “Notes”). As of January 9, 2017, $650,000,000 aggregate principal amount of Notes were outstanding.
As previously announced on July 21, 2016, Joy Global, Komatsu America Corp. (“Komatsu America”), Pine Solutions Inc., a wholly owned subsidiary of Komatsu America (“Merger Sub”), and (solely for the purposes specified therein) Komatsu Ltd. (“Komatsu”) signed an Agreement and Plan of Merger (the “Merger Agreement”) pursuant to which, upon the terms and subject to the conditions set forth in the Merger Agreement, Merger Sub will be merged with and into Joy Global (the “Merger”). Upon completion of the Merger, Joy Global will become a direct wholly owned subsidiary of Komatsu America and an indirect wholly owned subsidiary of Komatsu. The stockholders of Joy Global approved the merger agreement at a special meeting of stockholders held on October 19, 2016. The transaction remains subject to certain regulatory approvals outside the United States and customary closing conditions. The transaction is on track to be completed by mid-2017, but may occur earlier depending on the progress of the remaining regulatory clearance procedures.
The consent solicitation will expire at 5:00 p.m., New York City time, on January 23, 2017, unless terminated or extended by Joy Global (the “Expiration Date”). The consent solicitation is conditioned on the receipt from holders of Notes as of 5:00 p.m., New York City time, on January 9, 2017 (the “Record Date”) of valid consents in respect of a majority in aggregate principal amount of the outstanding Notes, voting together as a single class. The consent solicitation is also conditioned on customary closing conditions, which Joy Global may waive at any time.
Joy Global will, after the Expiration Date and upon (i) the satisfaction or waiver of all conditions to the consent solicitation and (ii) the completion of the Merger, promptly pay to each holder of Notes who has delivered (and not validly revoked) a valid consent in favor of the proposed amendments prior to the Expiration Date a cash payment of $2.50 for each $1,000 principal amount of Notes in respect of which such consent has been delivered.
The purpose of the consent solicitation is to amend the indenture governing the Notes (the “Indenture”) to modify the reporting covenant so that, following the closing of the Merger, in the event that Komatsu decides, in its sole discretion, to provide an unconditional guarantee of Joy Global’s payment obligations under the Indenture, Komatsu will post on its website English language translations of its annual, quarterly and event-specific reports (prepared under applicable Japanese law and translated into English) that it is required to publish under the Financial Instruments and Exchange Act of Japan and the rules governing timely disclosure of corporate information by issuers of listed securities on the Tokyo Stock Exchange. These reports would be made available to holders of the Notes in lieu of Joy Global’s existing annual, quarterly and current reporting, which Joy Global would cease producing for so long as a Komatsu guarantee remains in force.
The consent solicitation may be amended, extended, abandoned or terminated at the option of Joy Global. For a complete statement of the terms and conditions of the consent solicitation, holders of the Notes should refer to the consent solicitation statement, dated as of January 10, 2017 and related letter of consent, which is being sent to holders of the Notes as of the Record Date.
The Solicitation Agent in connection with the consent solicitation is Mizuho Securities USA Inc. Questions regarding the consent solicitation may be directed to Mizuho Securities USA Inc., Attention: Liability Management Group at (866) 271-7403 (toll free) or (212) 205-7736 (collect). D. F. King & Co., Inc. is serving as Information Agent and Tabulation Agent in connection with the consent solicitation. Requests for assistance in delivering consents or for additional copies of the consent solicitation statement and related letter of consent should be directed to the Information Agent at (800) 967-5019 (toll free), (212) 269-5550 (banks and brokers) or firstname.lastname@example.org.
This announcement is not an offer to purchase, a solicitation of an offer to purchase, or a solicitation of consents with respect to any securities. The consent solicitation is being made solely by the consent solicitation statement and related letter of consent and is subject to the terms and conditions stated therein. Joy Global reserves the right to modify the terms and conditions of the consent solicitation or to terminate the consent solicitation.
About Joy Global
Joy Global is a leading provider of advanced equipment, systems and direct services for the global mining industry. Joy Global’s P&H, Joy and Montabert branded equipment is a critical component of operations in a variety of commodity markets including energy, hard rock and industrial minerals. Based in Milwaukee, Wisconsin, USA, Joy Global employs 10,500 people in 20 countries. For more information visit www.joyglobal.com.
Cautionary statement regarding forward-looking statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Terms such as “anticipate,” “around,” “believe,” “could,” “estimate,” “expect,” “forecast,” “indicate,” “intend,” “may be,” “objective,” “plan,” “potential,” “predict,” “project,” “should,” “will be,” and similar expressions are intended to identify forward-looking statements. The forward-looking statements in this press release are based on our current expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ materially from any forward-looking statement. These important risks and uncertainties are described in greater detail in Joy Global's Annual Report on Form 10-K for the fiscal year ended October 28, 2016, as well as in other documents filed by Joy Global with the SEC after the date thereof. Forward-looking statements contained herein are made only as to the date of this press release and Joy Global undertakes no obligation to update forward-looking statements to reflect new information. Joy Global cannot assure you the projected results or events will be achieved. Because forward-looking statements involve risks and uncertainties, they are subject to change at any time.