BLOOMFIELD HILLS, Mich. -

This morning, Penske Automotive Group revealed a pair of financial note offerings.

The first of the two announcements resulted in Penske commencing a cash tender offer for any and all of its outstanding $375.0 million aggregate principal amount of 7.75 percent Senior Subordinated Notes due 2016.

In connection with the tender offer, the company is soliciting consents from holders of the 2016 Notes to amendments to the indenture governing the 2016 Notes.

Officials explained the tender offer and consent solicitation are being made pursuant to an offer to purchase and consent solicitation statement dated today and a related letter of transmittal and consent.

Penske said holders who validly tender their 2016 Notes and deliver their consents to the Proposed Amendments prior to the early tender deadline of 5 p.m. ET on Aug. 27, unless extended, will receive the total consideration of $1,042.50 per $1,000 principal amount of the 2016 Notes, which includes an early tender premium/consent payment of $10.00 per $1,000 principal amount of the 2016 Notes, plus any accrued and unpaid interest on the 2016 Notes up to, but not including, the payment date.

The company stressed holders may not tender their 2016 Notes in the offer without delivering their consents to the proposed amendments, and holders may not deliver their consents to the Proposed Amendments without tendering their 2016 Notes pursuant to the offer.

Officials noted payment for 2016 Notes validly tendered and not validly withdrawn on or prior to the early tender deadline and accepted for purchase will be made at or promptly following the early tender deadline. They stated holders who validly tender their 2016 Notes after the early tender Deadline, but on or prior to the expiration date will receive the tender offer consideration of $1,032.50 per $1,000 principal amount of the 2016 Notes, plus any accrued and unpaid interest on the 2016 Notes up to, but not including, the date the 2016 Notes are purchased pursuant to the Offer, but will not receive the early tender premium/consent payment.

Penske explained payment for 2016 Notes validly tendered after the early tender deadline and on or prior to the expiration date, and accepted for purchase, will be made at or promptly following the expiration date. The offer is not conditioned on any minimum amount of 2016 Notes tendered, but is conditioned upon the satisfaction of certain customary conditions, including the completion of the company’s proposed offering of senior subordinated notes, as more fully described in the offer to purchase and consent solicitation statement.

The company said the offer will expire at the end of the day, ET on Sept. 11 unless extended. Management stressed any 2016 Notes purchased pursuant to the offer will be cancelled, and those 2016 Notes will cease to be outstanding.

Upon receipt of consents from holders of a majority in aggregate principal amount of the outstanding 2016 Notes, the company and the Bank of New York Mellon Trust Company, N.A., as trustee will execute a supplemental indenture giving effect to the proposed amendments, which amendments will become operative when validly tendered 2016 Notes are accepted for purchase by the company pursuant to the offer.

Except in certain circumstances, officials indicated 2016 Notes tendered and consents delivered pursuant to the offer may not be withdrawn or revoked after execution of the supplemental indenture. The proposed amendments would, among other modifications, eliminate substantially all of the restrictive covenants and certain event of default provisions contained in the indenture governing the 2016 Notes.

The complete terms and conditions of the offer are set out in the offer to purchase and consent solicitation statement and the related letter of transmittal and consent. The holders of 2016 Notes may obtain copies of all the offer documents, including the offer to purchase and consent solicitation statement and the letter of transmittal and consent, free of charge by directing a request to the information agent for the offer at:

Georgeson Inc.
199 Water Street, 26th Floor
New York, N.Y. 10038

Banks and brokers can call (212) 440-9800 while all others can call (800) 561-3991.

Penske has retained BofA Merrill Lynch to act as dealer manager in connection with the offer. Persons with questions regarding the offer should contact BofA Merrill Lynch at (888) 292-0070 or (646) 855-3401.

The Bank of New York Mellon Trust Company, N.A. has been appointed to act as the Depositary for the Offer.

“This press release is neither an offer to purchase, a solicitation of an offer to sell the 2016 Notes or any other securities or a solicitation of consents, and is neither an offer to sell nor a solicitation of an offer to purchase the company’s new senior subordinated notes or any other securities,” Penske officials declared.

“The offer is made only by and pursuant to the terms of the offer to purchase and consent solicitation statement and the related letter of transmittal and consent,” they continued. “None of the company, its management, its board of directors, the information agent, the dealer manager, the depositary, the trustee nor any other person makes any recommendation as to whether holders of the 2016 Notes should tender their 2016 Notes or deliver their consents, and no one has been authorized to make such a recommendation.

"Holders of the 2016 Notes must make their own decisions as to whether to tender their 2016 Notes and deliver their consents, and, if they decide to do so, the principal amount of 2016 Notes to tender,” they went on to say.

Penske Announces $400 Million Senior Subordinated Notes Offering

In other company news, Penske also announced that it intends to offer $400.0 million aggregate principal amount of fixed rate Senior Subordinated Notes due 2022 in a private offering to qualified institutional buyers in the United States pursuant to Rule 144A, and outside the United States pursuant to Regulation S, under the Securities Act of 1933 as amended.

The company said it intends to use the net proceeds of this offering to purchase any and all of the company’s $375.0 million in principal amount of 7.75% Senior Subordinated Notes due 2016 tendered in connection with the company’s concurrent tender offer for the 2016 Notes and consent solicitation, and to pay fees and expenses in connection with the offering.

Officials indicated the remaining proceeds from this offering will be used to repay amounts currently outstanding under the company’s U.S. credit agreement and, if additional funds are remaining, its U.S. floor plan borrowings.

“The 2022 Notes offered have not been registered under the Securities Act or the securities laws of any other jurisdictions, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements,” Penske management noted.

“This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the 2022 Notes or the 2016 Notes, nor shall it constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale is unlawful,” the company concluded.