Steinway Musical Instruments (LVB) Inactive
Filed: 30 Jul 13, 12:00am
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE TO
Tender Offer Statement under Section 14(d)(1) or 13(e)(1)
of the Securities Exchange Act of 1934
(Amendment No. 3)
STEINWAY MUSICAL INSTRUMENTS, INC.
(Names of Subject Company (issuer))
KSTW ACQUISITION, INC.
(Name of Filing Persons (Offeror)) a wholly owned indirect subsidiary of
KSTW HOLDINGS, INC.
(Name of Filing Persons (Parent of Offeror))
KOHLBERG INVESTORS VII, L.P.
(Names of Filing Persons (Other Person))
COMMON STOCK, $0.001 PAR VALUE PER SHARE
(Title of Class of Securities)
858495104
(CUSIP Number of Class of Securities)
KSTW Acquisition, Inc.
KSTW Holdings, Inc.
c/o Kohlberg & Company
111 Radio Circle
Mount Kisco, New York 10549
Attention: Christopher W. Anderson
(914) 241-7430
(Name, address and telephone number of person authorized to receive notices and communications on behalf of filing persons)
with copies to:
William M. Shields, Esq.
Ropes & Gray LLP
800 Boylston Street
Boston, Massachusetts 02199
Phone: (617) 951-7000
CALCULATION OF FILING FEE
Transaction valuation* | Amount of filing fee** | |
| $458,488,240.00 | $62,537.80 |
| * | Estimated solely for purposes of calculating the filing fee. The transaction valuation was calculated by multiplying the offer price of $35.00 per share of common stock of Steinway Musical Instruments, Inc. (“Steinway”), par value $0.001 per share, (“Shares”) by 13,099,664 Shares, which, based on information provided by Steinway as of June 27, 2013, is the sum of (i) 12,475,114 Shares outstanding and (ii) 624,550 Shares authorized and reserved for issuance pursuant to outstanding options to purchase Shares. |
| ** | The filing fee, calculated in accordance with Rule 0-11 of the Securities Exchange Act of 1934, as amended, and Fee Rate Advisory #1 for fiscal year 2013, issued August 31, 2012, is calculated by multiplying the Transaction Valuation by .00013640. |
| x | Check the box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
| Amount Previously Paid: $62,537.80 | Filing Party: KSTW Acquisition, Inc. | |
| Form or Registration No.: Schedule TO-T | Date Filed: July 15, 2013 |
| ¨ | Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer. |
Check the appropriate boxes below to designate any transactions to which the statement relates:
| x | third-party tender offer subject to Rule 14d-1. |
| ¨ | issuer tender offer subject to Rule 13e-4. |
| ¨ | going-private transaction subject to Rule 13e-3. |
| ¨ | amendment to Schedule 13D under Rule 13d-2. |
Check the following box if the filing is a final amendment reporting the results of the tender offer: ¨
If applicable, check the appropriate box(es) below to designate the appropriate rule provision(s) relied upon:
| ¨ | Rule 13e-4(i) (Cross-Border Issuer Tender Offer) |
| ¨ | Rule 14d-1(d) (Cross-Border Third-Party Tender Offer) |
This Amendment No. 3 amends and supplements the Tender Offer Statement on Schedule TO filed with the Securities and Exchange Commission (the “SEC”) on July 15, 2013, as amended by Amendment No. 1 filed with the SEC on July 19, 2013 and Amendment No. 2 filed with the SEC on July 23, 2013 (which, together with any subsequent amendments or supplements thereto, collectively constitutes this “Schedule TO”). This Schedule TO relates to the tender offer by KSTW Acquisition, Inc., a Delaware corporation (“Purchaser”) and a wholly owned subsidiary of KSTW Holdings, Inc., a Delaware corporation (“Parent”), which is controlled by Kohlberg Investors VII, L.P., a Cayman Islands limited partnership (“Sponsor”), for all of the outstanding shares of common stock, par value $0.001 per share (“Shares”), of Steinway Musical Instruments, Inc., a Delaware corporation (“Steinway”), at a price of $35.00 per share, net to the seller in cash, without interest thereon and less any applicable withholding taxes, upon the terms and conditions set forth in the offer to purchase dated July 15, 2013 (the “Offer to Purchase”), a copy of which is attached as Exhibit (a)(1)(A) to the Schedule TO, and in the related letter of transmittal (the “Letter of Transmittal”), a copy of which is attached as Exhibit (a)(1)(B) to the Schedule TO, which, together with any other related materials, as each may be amended or supplemented from time to time, collectively constitute the “Offer.”
All the information set forth in the Offer to Purchase is incorporated by reference herein in response to Items 1 through 9 and Item 11 of this Schedule TO, and is supplemented by the information specifically provided in this Schedule TO.
This Amendment No. 3 is being filed to amend and supplement Items 1 through 9 and Item 11 as reflected below.
Items 1 through 9 and Item 11.
Items 1 through 9 and Item 11 of the Schedule TO are hereby amended and supplemented by as follows:
The final paragraph on page 16 of the Offer to Purchase under Section 9 — “Source and Amount of Funds — Debt Financing” is hereby replaced with the following:
“Pursuant to the Merger Agreement, Purchaser has agreed to use its reasonable best efforts to cause the lenders to fund the Debt Financing into escrow at least five days prior to the end of the initial Offer period, or no later than August 14, 2013, with the release of such escrowed funds to be subject only to the satisfaction of the conditions set forth in the Merger Agreement (other than the Financing Proceeds Condition). Upon the funding of the Debt Financing into escrow on or before August 14, 2013, the Financing Proceeds Condition will be deemed irrevocably waived. If the Debt Financing is not funded into escrow on or before August 14, 2013, we intend to extend the Offer and file an amendment to the Schedule TO. If the funding of the Debt Financing into escrow occurs after August 14, 2013, we intend to waive the Financing Proceeds Condition, extend the Offer and file an amendment to the Schedule TO. If the Debt Financing is never funded into escrow, we will be under no obligation to waive the Financing Proceeds Condition or to purchase the tendered Shares. We will publicly announce any material developments regarding the Debt Financing and the Financing Proceeds Condition by filing an amendment to the Schedule TO.
The foregoing summary of the Debt Commitment Letters is qualified in its entirety by reference to the Term Facilities Commitment Letter, a copy of which is filed as Exhibit (b)(1) to the Schedule TO, and the GE Capital Commitment Letter, a copy of which is filed as Exhibit (b)(2) to the Schedule TO, which are incorporated herein by reference.”
The fifth paragraph on page 17 of the Offer to Purchase under Section 10 — “Background of the Offer; Past Contacts or Negotiations with Steinway — Background of the Offer” is hereby amended and restated to state in its entirety:
“On April 16, 2013 and April 23, 2013, representatives from Kohlberg participated in calls with Mr. Messina and the Investment Banker to discuss the business and background of Steinway. On April 23, 2013, after having previously informed Kohlberg that Steinway was pursuing strategic alternatives, Mr. Messina provided Kohlberg with his view that he expected Steinway’s 2013 revenue and EBITDA (earnings before net interest expense, income taxes, depreciation and amortization) to improve from 2012 levels and also shared Steinway’s expected revenue and EBITDA results for the fiscal quarter ended March 31, 2013. The first quarter results that Mr. Messina shared were consistent with the results Steinway later disclosed on May 8, 2013 for the fiscal quarter ended March 31, 2013, and Mr. Messina did not share any additional material confidential information about Steinway with the Filing Persons during their communications with him. Representatives from a proposed financing source (the “Potential Lender”) also joined the April 23, 2013 call. Further discussions between Kohlberg and Mr. Messina were held on April 25, 2013, and between Kohlberg, Mr. Messina, the Investment Banker and the Potential Lender on April 26, 2013.”
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The second paragraph on page 18 of the Offer to Purchase under Section 10 — “Background of the Offer; Past Contacts or Negotiations with Steinway — Background of the Offer” is hereby amended and restated to state in its entirety:
“Based on the results of its continued due diligence efforts, on June 29, 2013, Kohlberg Management submitted to Steinway a proposal to acquire all outstanding shares of Steinway’s common stock for $35.00 per share in cash, which would expire at 12:00 noon Eastern Daylight Time on July 1, 2013. Mr. Messina did not provide any forecasts, non-public projections or other confidential information that had an impact on the proposal. Also on June 29, 2013, Ropes & Gray delivered a draft of a proposed merger agreement to Skadden, Arps, Slate, Meagher & Flom LLP (“Skadden Arps”), legal counsel to the special committee of Steinway’s board of directors. Between June 29, 2013 and June 30, 2013, Ropes & Gray and Skadden Arps had numerous discussions and negotiations to finalize the terms of a definitive merger agreement and related documentation.”
A new paragraph on page 42 of the Offer to Purchase at the end of Section 15 — “Certain Conditions of the Offer” is hereby added:
“The foregoing conditions (other than the conditions set forth in clauses (iv) (which have been met) and (v)) must be satisfied or waived on or before the expiration of the Offer (as it may be extended and re-extended as described in Section 11 – “The Merger Agreement; Other Agreements — The Merger Agreement — The Offer,” and in compliance with applicable laws).”
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SIGNATURES
After due inquiry and to the best of their knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.
Dated: July 30, 2013
| KSTW ACQUISITION, INC. | ||
| By: | /s/ Christopher Anderson | |
Name: Christopher Anderson Title: President | ||
| KSTW HOLDINGS, INC. | ||
| By: | /s/ Christopher Anderson | |
Name: Christopher Anderson Title: President | ||
KOHLBERG INVESTORS VII, L.P.
By: Kohlberg Management VII, L.P., its General Partner
By: Kohlberg GP Management VII, L.L.C., its General Partner | ||
| By: | /s/ Christopher Anderson | |
Name: Christopher Anderson Title: Vice President | ||
Exhibit | Description | |
| (a)(1)(A)* | Offer to Purchase, dated July 15, 2013 | |
| (a)(1)(B)* | Letter of Transmittal | |
| (a)(1)(C)* | Letter from the Information Agent to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees | |
| (a)(1)(D)* | Letter to Clients for Use by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees | |
| (a)(1)(E)* | Summary Advertisement as published in the Wall Street Journal on July 15, 2013 | |
| (a)(5)(A)* | Press Release issued by Steinway Musical Instruments, Inc. on July 1, 2013 (incorporated by reference to Exhibit 99.1 to the Schedule TO-C filed by KSTW Acquisitions, Inc. with the Securities and Exchange Commission on July 2, 2013) | |
| (a)(5)(B)* | Letter to the dealers and partners of Steinway & Sons, dated July 12, 2013 (incorporated by reference to Exhibit 99.1 to the Schedule TO-C filed by KSTW Acquisitions, Inc. with the Securities and Exchange Commission on July 12, 2013) | |
| (a)(5)(C)* | Letter to the dealers and partners of Conn-Selmer, dated July 12, 2013 (incorporated by reference to Exhibit 99.2 to the Schedule TO-C filed by KSTW Acquisitions, Inc. with the Securities and Exchange Commission on July 12, 2013) | |
| (a)(5)(D)* | Press Release by KSTW Acquisitions, Inc. on July 15, 2013 | |
| (a)(5)(E)* | Joint Press Release issued by Steinway Musical Instruments, Inc. and KSTW Acquisition, Inc. on July 22, 2013 | |
| (b)(1)* | Commitment Letter, dated July 15, 2013, by and among KSTW Holdings, Inc., KSTW Acquisition, Inc., MIHI LLC, Macquarie Capital (USA) Inc., Credit Suisse Securities (USA) LLC and Credit Suisse AG | |
| (b)(2)* | Commitment Letter, dated June 30, 2013, by and among KSTW Holdings, Inc., KSTW Acquisition, Inc. and General Electric Capital Corporation | |
| (b)(3)* | Equity Commitment Letter, dated June 30, 2013, by and among KSTW Holdings, Inc., KSTW Acquisition, Inc. and Kohlberg Investors VII, L.P. | |
| (d)(1) | Agreement and Plan of Merger, dated June 30, 2013, by and among KSTW Holdings, Inc., KSTW Acquisition, Inc. and Steinway Musical Instruments, Inc. (incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K filed by Steinway Musical Instruments, Inc. with the Securities and Exchange Commission on July 2, 2013) | |
| (d)(2)* | Confidentiality Agreement, dated May 9, 2013, between Steinway Musical Instruments, Inc. and Kohlberg Management VII, L.P. | |
| (d)(3) | Rights Agreement dated September 26, 2011 between Steinway Musical Instruments, Inc. and Continental Stock Transfer & Trust Company, as Rights Agent, including the Form of Certificate of Designations of Participating Preferred Stock, the Form of Right Certificate, and the Summary of Rights to Purchase Preferred Shares, respectively attached thereto (incorporated by reference to Exhibit 4.1 to the Form 8-A12G filed by Steinway Musical Instruments, Inc. with the Securities and Exchange Commission on September 27, 2011) | |
| (d)(4) | Amendment No. 1 to Rights Agreement, dated February 20, 2013 between the Company and Continental Stock Transfer & Trust Company (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed by Steinway Musical Instruments, Inc. with the Securities and Exchange Commission on February 22, 2013) | |
| (d)(5) | Amendment No. 2 to Rights Agreement dated June 30, 2013 between the Company and Continental Stock Transfer & Trust Company (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by Steinway Musical Instruments, Inc. with the Securities and Exchange Commission on July 2, 2013) | |
| (d)(6)* | Limited Guaranty, dated June 30, 2013, by and between Kohlberg Investors VII, L.P. and Steinway Musical Instruments, Inc. | |
| (g) | None | |
| (h) | None | |
*Previously filed.