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Axtel Announces Amendments and Supplements to Offers to Exchange Dated December 26, 2012

  Axtel Announces Amendments and Supplements to Offers to Exchange Dated
  December 26, 2012

Business Wire

SAN PEDRO GARZA GARCIA, Mexico -- January 14, 2013

Axtel, S.A.B. de C.V. (BMV: AXTELCPO; OTC: AXTLY) (“AXTEL” or “the Company”),
a Mexican fixed-line integrated telecommunications company, today announced
that has amended and supplemented the pending exchange offers being made by
its wholly owned subsidiary Axtel Capital, S.A. de C.V. SOFOM E.N.R. (“Axtel
Capital”) to exchange (the “Exchange Offers”) any and all of AXTEL’s
outstanding 7.625% Senior Notes due 2017 (the “2017 Notes”) and 9.00% Senior
Notes due 2019 (the “2019 Notes”, and together with the 2017 Notes, the “Old
Notes”) for a combination of Senior Secured Notes due 2020 (the “Senior
Secured Notes”), Peso-denominated Senior Secured Convertible Dollar-indexed
Notes due 2020 (the “Convertible Dollar-indexed Notes” and, together with the
Senior Secured Notes, the “New Notes”) of AXTEL and cash.

The Company indicated that, among other things, it is improving the economic
value of the offer and extending the Early Tender Date by one week. The
improved offer is based on discussions with various bondholders, and parties
who manage the two largest bond holdings are now supporting and participating
in the exchange offer.

Regarding the amendments to the Exchange Offers, the most significant are the
following:

1. Extension of Early Tender Date; Subsequent Withdrawal. The Early Tender
Date is changed to January 18, 2013, at 5:00 pm New York City time, unless
further extended by Axtel Capital. If the Expiration Date is extended beyond
February 11, 2013, Eligible Holders shall thereafter have the right to
withdraw Old Notes.

2. Changes to Consideration. The consideration offered in exchange for Old
Notes tendered is as set forth in the table below:

                                        Consideration per $1,000 Principal Amount of Old Notes Tendered
                                         On or Prior to Early Tender Date                         After Early Tender Date
                           Outstanding             Pesos-                                                    Pesos-
Old Notes                  Principal     Senior    denominated                                     Senior    denominated
to be      CUSIP/ISIN    Amount        Secured  Convertible  Cash   Consent  Total           Secured  Convertible  Cash   Exchange
Exchanged   Numbers        (in           Notes     Dollar-               Payment   Consideration   Notes     Dollar-               Consideration
                           millions)               indexed                                                   indexed
                                                   Notes(1)                                                  Notes (1)
                                                                                                                                   
7.625%      05462GAA2
Senior      P06064AA0/     $275.0        $500.00   $44.61        $50.0   $116.0    $710.61         $500.00   $44.61        $50.0   $594.61
Notes due   US05462GAA22
2017        USP06064AA01
                                                                                                                                   
9.00%       05462GAC8
Senior      P06064AB8/     $490.0        $500.00   $44.61        $50.0   $116.0    $710.61         $500.00   $44.61        $50.0   $594.61
Notes due   US05462GAC8
2019        USP06064AB83
                                                                                                                                   

      This number is an approximation representing approximately Ps. 570
      principal amount of Pesos-denominated Convertible Dollar-indexed Notes
(1)  converted into U.S. dollars at the commercial exchange rate of Ps.
      12.7777 per U.S. dollar reported by Banco de Mexico on December 20,
      2012.

The Exchange Offers are being made only to eligible holders, as described
below, pursuant to the Offer to Exchange and Consent Solicitation Statement
dated December 26, 2012, as supplemented by the First Supplement to Offer to
Exchange and Consent Solicitation Statement dated January 14, 2013 (together,
the “Offer to Exchange”) and related Consent and Letter of Transmittal which
set forth more fully the terms and conditions of the Exchange Offers and
consent solicitations.

Eligible holders of Old Notes who tender their Old Notes and deliver their
consents after the Early Tender Date will receive the consideration set forth
in the table above.

3. Changes to the Interest Rate of the New Notes. Interest on the New Notes
will accrue at the initial rate of 7.00% per annum. The interest rate shall
increase to 8.00% per annum on the first anniversary of the Issue Date and
shall increase to 9.00% per annum on the second anniversary of the Issue Date.

4. Changes to the Optional Redemption provisions of the Senior Secured Notes.
On and after January 31, 2016, we will be entitled at our option to redeem all
or a portion of the Senior Secured Notes upon not less than 30 nor more than
60 days’ notice, at the redemption prices (expressed in percentages of
principal amount on the redemption date), plus accrued interest to the
redemption date (subject to the right of Holders of record on the relevant
record date to receive interest due on the relevant interest payment date), if
redeemed during the 12-month period commencing on January 31 of the years set
forth below:

Period               Redemption Price
2016                  106.75%
2017                  104.50%
2018                  102.25%
2019 and thereafter   100.00%

Prior to January 31, 2016, we may at our option on one or more occasions, with
the Net Cash Proceeds from one or more Equity Offerings, redeem Senior Secured
Notes in an aggregate principal amount not to exceed 35% of the aggregate
principal amount of the Senior Secured Notes originally issued at the
redemption prices (expressed in percentages of principal amount on the
redemption date), plus accrued and unpaid interest to the redemption date, if
redeemed during the 12-month period ending on January 31 of the years set
forth below:

Period  Redemption Price
2014     107%
2015     108%
2016     109%

provided, however, that (1) at least 65% of such aggregate principal amount of
Senior Secured Notes remains outstanding immediately after the occurrence of
each such redemption (other than Senior Secured Notes held, directly or
indirectly, by the Company or its Affiliates); and (2) each such redemption
occurs within 90 days after the date of the related Equity Offering.

5. Changes to the Optional Redemption provisions of the Convertible
Dollar-indexed Notes. Axtel will not be entitled to redeem the Convertible
Dollar-indexed Notes at its option prior to January 31, 2016. On and after
January 31, 2016, Axtel will be entitled at its option to redeem some or all
of the Convertible Dollar-indexed Notes at a redemption price equal to 200% of
the principal amount of the Convertible Dollar-indexed Notes, plus accrued and
unpaid interest to the redemption date (subject to the right of holders of
record on the relevant record date to receive interest due on the relevant
interest payment date) and including Additional Amounts payable in respect of
such payment. In addition, on and after January 31, 2016, in the event that
the market price of Axtel’s CPOs exceeds 200% of the December 21, 2012
conversion price of Ps. 2.41 in at least 20 of the past 30 trading days, Axtel
will be entitled to redeem the Convertible Dollar-indexed Notes at a
redemption price equal to (a) 100% of their principal amount, plus (b) accrued
and unpaid interest to the redemption date (subject to the right of holders of
record on the relevant record date to receive interest due on the relevant
interest payment date) and including Additional Amounts payable in respect of
such payment.

6. Changes to the Covenants applicable to the Convertible Dollar-indexed
Notes. So long as the Senior Secured Notes are outstanding, the indenture
governing the Convertible Dollar-indexed Notes will not include restrictive
covenants. If the Convertible Dollar-indexed Notes remain outstanding at any
time that the Senior Secured Notes are not outstanding and the Senior Secured
Notes Indenture is not in effect, the Company will enter into a supplemental
indenture to include in the Convertible Dollar-indexed Notes Indenture such
restrictive covenants as are in the Senior Secured Notes Indenture.

The consummation of the Exchange Offers and related consent solicitations are
subject to the conditions set forth in the Offer to Exchange, including, among
other things, the receipt by the Company of consents of the holders
representing at least a majority in aggregate principal amount of each of the
2017 Notes and the 2019 Notes, the concurrent consummation of the
sale-and-leaseback transaction with MATC Digital, S. de R.L. de C.V., a
subsidiary of American Tower Corporation which has been previously disclosed
by Axtel, and on other terms and conditions.

The complete terms and conditions of the Exchange Offers and consent
solicitations are de-scribed in the Offer to Exchange, copies of which may be
obtained by eligible holders by contacting D.F. King & Co., Inc., the
information agent for the exchange offers and consent solicitations, at 48
Wall Street, 22nd Floor, New York, New York 10005, (212) 269-5550 (collect) or
(800) 967-4612 (toll free), or axtel@dfking.com.

The New Notes have not been registered under the Securities Act, or any state
securities laws, and may not be offered or sold in the United States absent
registration or an applicable exemption from registration requirements, and
will therefore be subject to substantial restrictions on transfer.

The Exchange Offers are being made, and the New Notes are being offered and
issued, only to registered holders of Old Notes (i) in the United States who
are (a) “qualified institutional buyers,” as that term is defined in Rule 144A
under the Securities Act of 1933, as amended (the “Securities Act”) or (b)
“accredited investors,” as that term is defined in Rule 501(a) under the
Securities Act, that are institutions of the types described in clauses (1),
(2), (3) and (7) of Rule 501(a) and (ii) outside the United States and are
persons who are not “U.S. persons,” as that term is defined in Rule 902 under
the Securities Act.

This announcement is for informational purposes only and does not constitute
an offer to sell or a solicitation of an offer to buy the New Notes nor an
offer to purchase Old Notes nor a solicitation of Consents. The Exchange
Offers and Consent Solicitations are being made solely by means of the Offer
to Exchange and the related Consent and Letter of Transmittal.

About AXTEL

AXTEL is a Mexican telecommunications company with significant growth in the
broadband segment, and one of the leading companies in information and
communication technologies solutions in the corporate, financial and
government sectors. The Company serves all market segments - corporate,
financial, government, wholesale and residential with the most robust offering
of integrated communications services in Mexico. Its world-class network
consists of different access technologies like fiber optic, fixed wireless
access, point to point and point to multipoint links, in order to offer
solutions tailored to the needs of its customers.

AXTEL's shares, represented by Ordinary Participation Certificates or CPOs,
trade on the Mexican Stock Exchange under the symbol 'AXTELCPO' since 2005.

Forward-Looking Statements

This release contains certain forward-looking statements regarding the future
events or the future financial performance of AXTEL that are made pursuant to
the safe harbor for forward-looking statements provided by the Private
Securities Litigation Reform Act of 1995. These statements reflect
management's current views with respect to future events or financial
performance, and are based on management's current assumptions and information
currently available and are not guarantees of the Company's future
performance. The timing of certain events and actual results could differ
materially from those projected or contemplated by the forward-looking
statements due to a number of factors including, but not limited to those
inherent to operating in a highly regulated industry, strong competition,
commercial and financial execution, economic conditions, among others.

Contact:

Axtel, S.A.B. de C.V.
Investor Relations
Adrian de los Santos, +52(81) 8114-1128
IR@axtel.com.mx
 
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