November 30, 2004
United States Securities and Exchange Commission
Division of Corporation Finance
450 Fifth Street, N.W., Mail Stop 0303
Washington, D.C. 20549-0303
Attn: Julia E. Griffith
RE: ANIXTER INTERNATIONAL INC.
AMENDMENT NO. 1 TO REGISTRATION STATEMENT ON FORM S-4 FILED
NOVEMBER 30, 2004
FILE NO. 333-120270
AMENDMENT NO. 1 SCHEDULE TO-I FILED NOVEMBER 30, 2004
FILE NO. 005-13735
Dear Ms. Griffith:
We are in receipt of your comment letter dated November 23, 2004 to
Anixter International Inc. (the "Company"). We have addressed your November 23,
2004 letter by reproducing each comment below and providing our response
immediately following. Simultaneously with the delivery of this letter, we have
filed the above referenced amendments to the Registration Statement and the
Schedule TO with changes responsive to your comment letter.
GENERAL
1. Comment: We urge the company and all persons who are responsible for
the accuracy and adequacy of the disclosure in the filings reviewed by
the staff to be certain that they have provided all information
investors require. Since the company is in possession of all facts
relating to its disclosure, the company is responsible for the accuracy
and adequacy of the disclosures it has made.
In connection with responding to our comments, please provide,
in writing, a statement from the company acknowledging that:
o the company is responsible for the adequacy and accuracy of
the disclosure in the filings;
o staff comments or changes to disclosure in response to
staff comments in the filings reviewed by the staff do not
foreclose the Commission from taking any action with
respect to the filing; and
o the company may not assert staff comments as a defense on
any proceeding initiated by the Commission or any person
under the federal securities laws of the United States.
November 30, 2004
United States Securities and Exchange Commission
Page 2
In addition, please be advised that the Division of
Enforcement has access to all information you provide to the staff of
the Division of Corporate Finance in our review of your filing or in
response to our comments on your filings.
Response: On behalf of the Company, the undersigned acknowledges that:
o the Company is responsible for the adequacy and accuracy of
the disclosure in the filings;
o staff comments or changes to disclosure in response to staff
comments in the filings reviewed by the staff do not foreclose
the Commission from taking any action with respect to the
filing; and
o the Company may not assert staff comments as a defense on any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.
2. Comment: We note that the "terms of the New Securities will be the same
as the terms of the Old Securities" except that you have changed the
conversion feature so that Anixter may account for the New Securities
under the treasury stock method (but carry over the holding period for
the Old Securities). If the outstanding notes were not issued in a
registered offering, please tell us the exemption upon which you relied
to issue those securities and why it is appropriate to exchange them
for similar securities in a registered offering
Response: The Old Securities were originally issued to Merrill Lynch
pursuant to the exemption found in Section 4(2) of the Securities Act
of 1933, and Merrill Lynch distributed the Old Securities to qualified
institutional buyers in reliance on Rule 144A under the Act. Certain of
the notes, originally placed pursuant to Rule 144A or resold in
secondary market transactions pursuant to that rule, remain restricted
securities. The remaining Old Securities have been resold in secondary
market transactions pursuant to an effective resale shelf registration
statement and are no longer restricted securities.
The Company believes that all New Securities to be issued in the
exchange offer should be treated as unrestricted securities because
they will be issued pursuant to an effective registration statement. We
are aware that the staff has placed limitations on the ability of
issuers to provide holders unrestricted securities by the use so-called
"A/B" exchange offers under the Morgan Stanley no action letter and
related letters. Among those limitations is the inability to use A/B
exchange offers to register convertible debt securities. However, the
policy reason for limitations on the use of A/B exchanges appears to be
to discourage transactions intended to evade registration under the
Act. We believe A/B exchanges are closely regulated due to the
identical terms of the old securities and the new securities issued and
delivered in exchange (other than applicable transfer restrictions),
the lack of other independent purpose, the short time that elapses
between the original exempt offer and the exchange and the fact that
the restricted securities are purchased in reliance on a contractual
undertaking to conduct an exchange offer designed to provide security
holders with freely transferable but otherwise identical securities. In
the Company's situation, the Old Securities and the New Securities are
not identical. In fact, the change is significant enough to require the
payment of an exchange fee in order to induce holders to tender (as
opposed to an A/B exchange, in which the ability to receive
unrestricted securities is enough to induce the tender.) The receipt of
unrestricted securities is incidental to the primary purpose of the
exchange offer, which is to obtain certain desired accounting
treatment. In fact, holders not tendering will still have the ability
to resell their Old Securities under the resale shelf registration
statement. The Company's exchange offer will
November 30, 2004
United States Securities and Exchange Commission
Page 3
close 17 months after the original placement, versus a typical
contractual maximum of six months with an A/B exchange. This is a clear
indication that the securities were not acquired with a view to
distribution and the tendering holders are not statutory underwriters.
Lastly, holders of the Old Securities did not purchase, and the Company
did not sell, the Old Securities with an expectation that there would
be a registered exchange of the Old Securities; the exchange offer was
motivated by a change in accounting standards, which was not expected.
In an A/B exchange, the exchange is conducted pursuant to a
contractual obligation undertaken by the issuer in connection with the
original placement of the restricted security.
SUMMARY, PAGE 5
3. Comment: We note your disclosure that the tax consequences of the
exchange are unclear. Please disclose the name of any tax counsel from
whom you have sought an opinion, or whose advice you have relied upon.
Response: We have complied with your request.
MATERIAL DIFFERENCES BETWEEN THE OLD SECURITIES AND NEW SECURITIES, PAGE 6
4. Comment: Revise this section to include information about when the Old
Securities were issued, and their maturity date.
Response: We have complied with your request.
THE NEW SECURITIES, PAGE 8
5. Comment: Please revise your discussion on Issue Discount to state
whether the loss of the original issue discount tax treatment
constitutes a risk of participating in the offer.
Response: The discussion of Issue Discount has been revised to reflect
that both the Old Securities and the New Securities will be subject to
original issue discount tax treatment.
CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING INFORMATION, PAGE 16
6. Comment: The Private Securities Litigation Reform Act does not apply to
statements made in connection with a tender offer. See Section
21E(b)(2)(C) of the Securities Exchange Act of 1934. Please eliminate
any reference to the safe harbor and the Act. See also Q&A 2, Section
I.M. of the Division of Corporate Finance's Manual of Publicly
Available Telephone Interpretations, which is available on our website
at www.sec.gov.
Response: We have revised our disclosure to eliminate any reference to
the forward looking safe harbor and the Private Securities Litigation
Reform Act.
November 30, 2004
United States Securities and Exchange Commission
Page 4
THE EXCHANGE OFFER, PAGE 21
CONDITIONS OF THE EXCHANGE OFFER, PAGE 21
7. Comment: Revise your description to remove the words "Notwithstanding
any other provision of the exchange offer to the contrary..." where
they appear throughout this section. This implies that security holders
are not entitled to rely on the plain language of your disclosure.
Response: We have complied with your request.
8. Comment: Refer to your disclosure concerning acceptance of the
securities. Please confirm your understanding that all offer
conditions, other than receipt of governmental or regulatory approvals,
must be satisfied or waived on or before the expiration date of the
offer, not the date of acceptance of or the date of payment for
tendered securities. Please revise that disclosure here in accordance
with this comment.
Response: The Company confirms its understanding that other than
receipt of governmental or regulatory approvals, all offer conditions
must be satisfied or waived on or before the expiration date of the
offer, not the date of acceptance of or the date of payment for
tendered securities. We have revised the disclosure to indicate that
offer conditions must be satisfied on or before the expiration date of
the offer.
9. Comment: We note that you may waive the conditions you list in your
document at any time in your sole discretion. Please be aware that if
you waive a material condition, the offer must remain open for at least
five business days after that waiver.
Response: The Company takes note of your comment.
EXTENSION, DELAY IN ACCEPTANCE, AMENDMENT OR TERMINATION, PAGE 22
10. Comment: We note that your disclosure that you "are not aware of any
circumstances that would cause us to delay acceptance of any validly
tendered Old Securities." Revise to clarify that you will issue the new
securities promptly after expiration of the offer.
Response: We have complied with your request.
DETERMINATION OF VALIDITY, PAGE 24
11. Comment: Revise your disclosure to state that you will return the Old
Securities promptly, in keeping with Rule 14e-1(c), not "unless
otherwise provided in the letter of transmittal."
Response: We have complied with your request.
November 30, 2004
United States Securities and Exchange Commission
Page 5
CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS, PAGE 44
12. Comment: Revise this subsection and its title to clarify that you
describe all material federal tax consequences of the transaction. For
example, eliminate the term "Certain" from your title.
Response: We have complied with your request.
13. Comment: Given that Schiff Hardin LLP is providing a tax opinion,
please revise the prospectus' tax discussion to identify the firm as
tax counsel. Also, because you are providing as a short form tax
opinion, you should revise the lead-in paragraph and remove all
references in this section indicating that it is a "summary" as opposed
to counsel's tax opinion. Further, clarify which matters in this
section constitute counsel's tax opinion. With respect to a particular
tax consequence, to the extent possible provide a "should" or "more
likely than not" opinion. Alternatively, clearly state that tax counsel
is not able to opine on a particular tax consequence.
Response: We have identified Schiff Hardin LLP as our tax counsel. We
have removed references indicating that this is a summary. We have
clarified that Schiff Hardin LLP has rendered an opinion that the
exchange should not constitute a "substantial modification" of the Old
Securities for U.S. federal income tax purposes. We have refiled the
opinion of Schiff Hardin LLP, specifically indicating this conclusion,
as an exhibit to Form S-4 of the Registration Statement.
WHERE YOU CAN FIND MORE INFORMATION, PAGE 51
14. Comment: We note that you incorporate into the Form S-4 future filings
that you may make prior to the termination of the exchange offer.
Please confirm that the Schedule TO-I will be amended to specifically
include any information that is deemed to be forward-incorporated by
reference into the Form S-4, or advise.
Response: The Schedule TO will be amended to specifically include any
information that is deemed to be forward-incorporated by reference into
the Form S-4.
EXHIBIT 5.1 - LEGALITY OPINION
15. Comment: It is unclear why counsel has determined that it is
appropriate to assume the new debentures will be legal, valid and
binding "When the New Securities have been duly executed, authenticated
and issued in accordance with the provisions of the Indenture and ...
delivered against receipt of the Old Securities." Please revise.
Response: We have complied with your request to indicate that the only
condition to enforceability will be execution and authentication of the
New Securities. The revised opinion has been filed as an exhibit to
Amendment No. 1 to the Registration Statement.
November 30, 2004
United States Securities and Exchange Commission
Page 6
16. Comment: Revise your opinion to specifically state that the securities
will be issued under the corporate laws of the state of Delaware,
including the statutory provisions and all applicable provisions of the
Delaware Constitution and judicial decisions interpreting those laws.
In addition, expand your opinion to cover the law of the jurisdiction
governing the Indenture.
Response: We have complied with your request. The revised opinion has
been filed as an exhibit to Amendment No. 1 to the Form S-4.
* * *
Please call me at (224) 521-8000 with any questions you may have.
Sincerely,
/s/ John A. Dul
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John A. Dul
cc: David McCarthy