By Angela McDaniels
Tacoma, Wash., Dec. 8 Citigroup Inc. determined the purchase prices it will pay in its tender offers and increased the maximum amount of notes it will purchase, according to company news releases.
On Nov. 17 the company began a tender offer for any and all of the $143.3 million outstanding 7.875% notes due 2025 issued by CitiFinancial Credit Co. and tender offers for a maximum amount of nine series of its own outstanding notes.
The total consideration for the 7.875% notes is $1,361 per $1,000 principal amount of notes.
In the maximum tender offers, Citigroup is tendering for
Up to $615 million of its $1,018,593,000 5.5% notes due 2017 at a total consideration of $1,049.47 per $1,000 principal amount of notes;
Up to $958,493,000 increased from $915 million of its $1,524,520,000 6% notes due 2017 at a total consideration of $1,078.50;
Up to $2,092,761,000 increased from $2,025,000,000 of its $3,374,259,000 6.125% notes due 2017 at a total consideration of $1,090.18;
Up to $1,365,000,000 of its $2,268,894,000 6.125% notes due 2018 at a total consideration of $1,106.73;
Up to $272,864,000 increased from $125 million of its $737,482,000 3.375% notes due 2023 at a total consideration of $1,006.48;
Up to $567,486,000 increased from $200 million of its $2 billion 3.875% notes due 2023 at a total consideration of $1,037.94;
Up to $29,132,000 increased from $20 million of its $189.75 million 5.85% notes due 2034 at a total consideration of $1,161.96;
Up to $500 million increased from $125 million of its $2,436,000,000 8.125% notes due 2039 at a total consideration of $1,491.60; and
Up to $50 million of its $478,858,000 4.95% notes due 2043 at a total consideration of $1,068.43 per $1,000 principal amount of notes.
Pricing was set by reference to a fixed spread over the yield of a Treasury security as of 2 p.m. ET on Dec. 8. Details can be found in the table below.
In each case, the total consideration includes a premium of $30.00 for each $1,000 principal amount of notes tendered by the early tender date, 5 p.m. ET on Dec. 7.
Holders who tender their notes after the early deadline will receive the tender offer payment, or the total amount less the early premium.
The company also will pay accrued interest up to but excluding the settlement date.
The tender offers will end at 11:59 p.m. ET on Dec. 21.
Early results
As of 5 p.m. ET on Dec. 7, the early tender date of the offers, holders had tendered the following amounts:
$13,106,000 of CitiFinancials 7.875% notes, all of which were accepted;
$479,614,000 of Citigroups 5.5% notes, all of which were accepted;
$958,493,000 of the 6% notes due 2017, all of which were accepted;
$2,092,761,000 of the 6.125% notes due 2017, all of which were accepted;
$1,331,329,000 of the 6.125% notes due 2018, all of which were accepted;
$272,864,000 of the 3.375% notes due 2023, all of which were accepted;
$567,486,000 of the 3.875% notes due 2023, all of which were accepted;
$29,132,000 of the 5.85% notes due 2034, all of which were accepted;
$1,129,597,000 of the 8.125% notes due 2039, $500 million of which were accepted; and
$113,086,000 of the 4.95% notes due 2043, $50 million of which were accepted.
All early tendered notes that have been accepted will be purchased on the early settlement date, which is expected to be Dec. 10. The final settlement date is expected to be Dec. 28.
Because the aggregate amount of 6% notes due 2017, 6.125% notes due 2017, 3.375% notes due 2023, 3.875% notes due 2023 and 5.85% notes due 2034 exceeded the original tender cap, Citigroup will not accept for purchase any additional notes of these series tendered after the early deadline. All of the notes of these series that were tendered at or prior to the early tender date will be accepted for purchase on the early settlement date.
Because the aggregate amount of 8.125% notes due 2039 and 4.95% notes due 2043 tendered by the early deadline exceeded the revised tender caps, those notes will be subject to proration. Citigroup will not accept for purchase any additional notes from those series that are tendered after the early deadline.
The company said it also is soliciting consents to eliminate substantially all of the restrictive covenants and events of default contained in the indenture governing the CitiFinancial notes. As of the early tender date, the company has not received the necessary consents to amend those notes.
Holders may not tender any notes without giving their consents or give consents without tendering their notes.
Tendered notes may no longer be withdrawn, and consents may no longer be revoked.
Citigroup Global Markets Inc. (800 558-3745 or 212 723-6106) is the dealer manager and solicitation agent. Global Bondholder Services Corp. (866 807-2200 or 212 430-3774) is the depositary and information agent.
The New York-based banking and financial services company began the offers on Nov. 17.
Citigroup tender offers pricing
| Notes | Reference Treasury | Fixed spread | Total Consideration
|
| 7.875% notes due 2025 | 2.25% Treasury due Nov. 15, 2025 | 105 bps | $1,361.00
|
| 5.5% notes due 2017 | 0.75% Treasury due Oct. 31, 2017 | 30 bps | $1,049.47
|
| 6% notes due 2017 | 0.75% Treasury due Oct. 31, 2017 | 30 bps | $1,078.50
|
| 6.125% notes due 2017 | 0.75% Treasury due Oct. 31, 2017 | 45 bps | $1,090.18
|
| 6.125% notes due 2018 | 1.25% Treasury due Nov. 15, 2018 | 40 bps | $1,106.73
|
| 3.375% notes due 2023 | 2.25% Treasury due Nov. 15, 2025 | 105 bps | $1,006.48
|
| 3.875% notes due 2023 | 2.25% Treasury due Nov. 15, 2025 | 110 bps | $1,037.94
|
| 5.850% notes due 2034 | 2.875% Treasury due Aug. 15, 2045 | 160 bps | $1,161.96
|
| 8.125% notes due 2039 | 2.875% Treasury due Aug. 15, 2045 | 170 bps | $1,491.60
|
| 4.950% notes due 2043 | 2.875% Treasury due Aug. 15, 2045 | 155 bps | $1,068.43
|
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