Citigroup announces early response, sets pricing in tender for notes

New York, Aug. 10 – Citigroup Inc. announced the amounts tendered by the early deadline in its offer to buy seven series of notes and set the purchase prices.

The bank will buy all the securities tendered in the any and all offer, which covers three series of notes.

All notes from the remaining four series that were validly tendered will be accepted for purchase since the responses were below the tender caps.

Early settlement is scheduled for Aug. 12, according to a press release.

The response and prices in the any and all offer were as follows:

• C$90,267,000 of the C$228,393,000 of 5.365% subordinated notes due 2036. Citi will pay C$1,087.03 per C$1,000 principal amount, set using the 5% Government of Canada Bond due June 1, 2037 plus 260 basis points;

• $5,637,000 of the $123.21 million of 5.875% senior notes due 2037. The purchase price is $1,201.07 per $1,000 principal amount, based on the 2.5% Treasury due Feb. 15, 2045 plus 150 bps; and

• $31,572,000 of the $320,904,000 of 6.875% senior notes due 2038. Pricing is $1,347.05 per $1,000 principal amount, set using the 2.5% Treasury due Feb. 15, 2045 plus 150 bps.

The response and prices in the capped offers were as follows:

• $21,733,000 of the outstanding $213,483,000 of 5.85% senior notes due 2034. The tender for this series is capped at $100 million. Citi will pay $1,183.49 per $1,000 principal amount, based on the 2.5% Treasury due Feb. 15, 2045 plus 150 bps;

• $45,885,000 of the outstanding $597,425,000 of 5.875% subordinated notes due 2033. The tender for this series is capped at $180 million. Pricing is $1,135.76 per $1,000 principal amount, set using the 2.5% Treasury due Feb. 15, 2045 plus 180 bps;

• $131,640,000 of the outstanding $806,524,000 of 6% subordinated notes due 2033. The tender for these notes is capped at $250 million. The purchase price is $1,153.24 per $1,000 principal amount, based on the 2.5% Treasury due Feb. 15, 2045 plus 180 bps; and

• $263.66 million of the outstanding $989,931,000 of 6.125% subordinated notes due 2036. The tender for this series is capped at $300 million. Pricing is $1,177.63 per $1,000 principal amount, calculated using the 2.5% Treasury due Feb. 15, 2045 plus 185 bps.

Holders who tender their notes by the early tender date, 5 p.m. ET on Aug. 7, will receive the total consideration quoted above, which includes an early tender premium of $30.00 or C$30.00, as applicable, per $1,000 or C$1,000 of notes, respectively. Notes could have been withdrawn by the early tender date.

The company will also pay accrued interest up to the applicable settlement date.

Pricing was set at 2 p.m. ET on Aug. 10.

The offers were announced on July 27 and expire at 11:59 p.m. ET on Aug. 21.

In its original announcement, Citi said it may increase the tender cap for one or more series of the notes under the maximum tender offer.

According to the press release, the offers are consistent with Citi’s liability management strategy and reflect its ongoing efforts to enhance the efficiency of its funding and capital structure.

Since 2013, Citi has redeemed or retired $28.1 billion of securities, excluding exchanged securities, of which $6 billion was redeemed or retired in 2015, reducing the company’s overall funding costs.

Citi said it will continue considering opportunities to redeem or repurchase securities based on several factors, including the economic value, potential impact on Citi’s net interest margin and borrowing costs, the overall remaining tenor of Citi’s debt portfolio, capital impact and overall market conditions.

Citigroup Global Markets Inc. (800 558-3745 or 212 723-6106) is the sole dealer manager for the offers. Global Bondholder Services Corp. (866 470-4300 or 212 430-3774) is the depositary and information agent for U.S. dollar-denominated notes. Kingsdale Shareholder Services (888 518-1557 or 416 867-2272) is the depositary and information agent for Canadian dollar-denominated notes.

Citigroup is a financial services company based in New York City.

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