- PAR Investment Partners to exchange $49.68 million of Orbitz Worldwide
senior term debt for 8.16 million shares of Orbitz Worldwide common stock
CHICAGO, Nov. 5 /PRNewswire-FirstCall/ -- Orbitz Worldwide, Inc. (NYSE: OWW)
today announced two simultaneous transactions. In the first transaction PAR
Investment Partners ("PAR") has entered into a definitive agreement to
exchange $49.68 million of senior term debt for 8.16 million shares of the
Company's common stock. In the second transaction, Travelport has entered
into a definitive agreement to make a $50 million investment in the Company's
common stock. Both equity investments were priced at $5.54 per share based on
the market closing price of the Company's common stock on Tuesday, November 3,
2009. These investments are expected to close in January 2010.
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"These significant investments in Orbitz by PAR and Travelport demonstrate
confidence in our company's strategic direction, operating team and ability to
grow the business. These transactions will enable us to reduce our debt by
$50 million, increase our cash by $50 million and give us additional operating
flexibility as we pursue the growth of our global hotel distribution
business," said Barney Harford, president and CEO, Orbitz Worldwide. "PAR is
a respected investor in the travel sector, and we look forward to their
deepened involvement in our business. We also welcome the strong vote of
confidence in Orbitz from Travelport and its controlling owner, Blackstone."
Terms of the Transactions
The definitive agreement with PAR provides that PAR will exchange $49.68
million aggregate principal amount of the Company's senior term debt for 8.16
million newly-issued shares of the Company's common stock. Orbitz Worldwide
will retire the debt it receives from PAR in accordance with the amendment to
its senior credit agreement that it entered into with lenders in June 2009.
The definitive agreement with Travelport provides that Travelport will
purchase 9.025 million newly-issued shares of the Company's common stock.
Blackstone and its controlled affiliates, which include Travelport, currently
own 55.0 percent of the Company's common stock. After this investment, taking
into account the dilution arising from the transactions, Blackstone and its
affiliates are expected to own 54.5 percent of the Company's outstanding
common stock. The funds received from Travelport are expected to be used for
general corporate purposes, which could include additional investments and
debt repayments.
Under the terms of the agreements, PAR will be granted the right to name one
director and Travelport will be granted the right to name one additional
director to the Orbitz Worldwide Board of Directors. These additions will
increase the total number of directors from eight to ten.
The transactions are subject to customary closing conditions, including a
condition that both equity investments occur simultaneously. Under New York
Stock Exchange rules, these investments are subject to approval by the
Company's shareholders. However, because both Travelport and PAR (which
collectively hold approximately 67 percent of the Company's outstanding common
stock) have agreed to vote in favor of the transactions (subject to certain
exceptions), it is expected that the requisite shareholder approval will be
obtained. The transactions are expected to close in January 2010 upon receipt
of shareholder approval.
The transactions were negotiated, evaluated and approved on Orbitz Worldwide's
behalf by a Special Committee of the Orbitz Worldwide Board of Directors
consisting solely of independent directors. Upon the recommendation of the
Special Committee, the Orbitz Worldwide Board of Directors approved the
transactions. Houlihan Lokey acted as the financial advisor to a Special
Committee and Davis Polk & Wardwell LLP served as legal counsel to the Special
Committee.
Quarterly Conference Call
Orbitz Worldwide will host a conference call to discuss this transaction and
its third quarter 2009 results at 10:00 a.m. EST (9:00 a.m. CST) on Thursday,
November 5, 2009. A live webcast of the conference call can be accessed
through the Orbitz Worldwide Investor Relations website at www.orbitz-ir.com.
An archive of the webcast and a transcript will also be available on the
website for a period of at least 30 days.
About Orbitz Worldwide
Orbitz Worldwide is a leading global online travel company that uses
innovative technology to enable leisure and business travelers to research,
plan and book a broad range of travel products. Orbitz Worldwide owns a
portfolio of consumer brands that includes Orbitz (www.orbitz.com),
CheapTickets (www.cheaptickets.com), ebookers (www.ebookers.com), HotelClub
(www.hotelclub.com), RatesToGo (www.ratestogo.com), the Away Network
(www.away.com), and corporate travel brand Orbitz for Business
(www.orbitzforbusiness.com). For more information on how your company can
partner with Orbitz Worldwide, visit corp.orbitz.com.
Orbitz Worldwide uses its Investor Relations website to make information
available to its investors and the public at www.orbitz-ir.com. You can sign
up to receive email alerts whenever the company posts new information to the
website.
Forward-Looking Statements
This press release and its attachments may contain forward-looking statements
that involve risks, uncertainties and other factors concerning, among other
things, Orbitz Worldwide's expected financial performance and its strategic
operational plans. The results presented are unaudited. The Company's actual
results could differ materially from the results expressed or implied by such
forward-looking statements and reported results should not be considered as an
indication of future performance. The potential risks, uncertainties and
other factors that could cause actual results to differ from those expressed
by the forward-looking statements in this press release and its attachments
include, but are not limited to, the current economic downturn and global
financial crisis; competition in the travel industry; factors affecting the
level of travel activity, particularly air travel volume; maintenance and
protection of the Company's information technology and intellectual property;
the outcome of pending litigation; the Company's significant indebtedness;
risks associated with doing business in multiple currencies; trends in the
travel industry; and general economic and business conditions. More
information regarding these and other risks, uncertainties and factors is
contained in the section entitled "Risk Factors" in the Company's filings with
the Securities and Exchange Commission ("SEC") which are available on the
SEC's website at www.sec.gov or the Company's Investor Relations website at
www.orbitz-ir.com. You are cautioned not to unduly rely on these
forward-looking statements, which speak only as of the date of this press
release. All information in this press release and its attachments is as of
November 5, 2009, and Orbitz Worldwide undertakes no obligation to publicly
revise any forward-looking statement.
SOURCE Orbitz Worldwide, Inc.
media, Brian Hoyt, +1-312-894-6890, bhoyt@orbitz.com, or investors, Marsha
Williams, +1-312-260-2415, marsha.williams@orbitz.com, both of Orbitz
Worldwide, Inc.
