Citigroup prices tender offers for $3.6 billion notes in five series

By Angela McDaniels

Tacoma, Wash., Dec. 16 – Citigroup Inc. set pricing in its tender offers for $3.6 billion of notes issued in five series, according to a company news release.

As previously reported, the company is offering to repurchase the following:

• Any and all of its $204,597,000 of outstanding 4.95% notes due 2043;

• Up to $75 million of its $516,724,000 of outstanding 5.875% subordinated notes due 2033;

• Up to $75 million of its $676,788,000 of outstanding 6.125% subordinated notes due 2036;

• Up to $75 million of its $954,999,000 of outstanding 5.3% subordinated notes due 2044; and

• Up to $250 million of its $1.25 billion of outstanding 4.65% notes due 2045.

For each $1,000 principal amount of notes, the total consideration is $1,071.34 for the 4.95% notes, $1,127.12 for the 5.875% notes, $1,161.83 for the 6.125% notes, $1,069.32 for the 5.3% notes and $1,042.08 for the 4.65% notes.

Each total consideration includes an early tender premium of $30.00 per $1,000 principal amount of notes tendered by 5 p.m. ET on Dec. 15, the early tender date.

The total consideration for a series of notes is equal to the price that equates to a yield to maturity equal to the applicable fixed spread specified for that series of notes over the applicable yield, which is based on the bid-side price of the 2.25% Treasury due Aug. 15, 2046 at 2 p.m. ET on Dec. 16. The reference yield is 3.19%.

The fixed spread is 130 basis points for the 4.95% notes, 155 bps for the 5.875% notes, 165 bps for the 6.125% notes and the 5.3% notes and 120 bps for the 4.65% notes.

The company will also pay accrued interest up to but excluding the settlement date, which is expected to be Dec. 20 for notes tendered by the early tender date and Jan. 5 for notes tendered after that time and accepted for purchase.

As of the early tender date, holders had tendered $143,885,000 of the 4.95% notes, $35,344,000 of the 5.875% notes, $175,406,000 of the 6.125% notes, $328,743,000 of the 5.3% notes and $832,071,000 of the 4.65% notes, according to a company update.

All of the 4.95% notes and 5.875% notes tendered by the early tender date were accepted. For the remaining series of notes, an amount equal to the cap for that series was accepted on a prorated basis.

Because the offers for the 6.125% notes, 5.3% notes and 4.65% notes are oversubscribed, none of these notes tendered after the early tender date will be accepted for purchase.

Each capped tender offer is subject to the condition that holders tender a principal amount of that series of notes greater than or equal to the cap for that series.

Since 2014, Citigroup has redeemed or retired $33.4 billion of securities. The company said it will continue to consider opportunities to redeem or repurchase securities.

Citigroup Global Markets Inc. (800 558-3745 or 212 723-6106) is the dealer manager. Global Bondholder Services Corp. (866 470-4300 or 212 430-3774) is the depositary and information agent.

Citigroup is a banking and financial services company based in New York.

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