Aflac lifts cap to $500 million in tender offer for 6.9%, 6.45% notes

By Angela McDaniels

Tacoma, Wash., Dec. 19 – Aflac Inc. had received tenders for $437,933,000 principal amount of notes in the tender offer for its 6.9% senior notes due 2039 and 6.45% senior notes due 2040 as of 5 p.m. ET on Dec. 16, according to a company news release.

The company decided to increase the maximum aggregate purchase price to $500 million from $400 million, excluding accrued interest.

The tender offer began Dec. 5. The early tender date was 5 p.m. ET on Dec. 16, and the offer will expire at 11:59 p.m. ET on Jan. 3.

As of the early tender date, holders had tendered $176,484,000 principal amount of the $400 million outstanding 6.9% notes, which have an acceptance priority level of one, and $261,449,000 principal amount of the $450 million outstanding 6.45% notes, which have an acceptance priority level of two.

The company said it will accept all of the 6.9% notes tendered by the early tender date and will accept the 6.45% notes tendered by the early tender date on a pro rata basis.

The company will not accept any notes tendered after the early tender date.

Pricing was scheduled to be set at 11 a.m. ET on Dec. 19 by reference to a fixed spread of 110 basis points over the yield to maturity of the 2.25% Treasury due Aug. 15, 2046.

The total consideration includes an early tender premium of $50.00 per $1,000 principal amount of notes tendered by the early tender date.

Had pricing been set at 11 a.m. ET on Dec. 2, the total consideration would have been $1,400.08 for the 6.9% notes and $1,339.60 for the 6.45% notes.

The company will also pay accrued interest up to but excluding the settlement date, which is expected to be Dec. 20.

The joint lead dealer managers are Goldman Sachs & Co. (800 828-3182 or 212 357-1452) and Wells Fargo Securities, LLC (866 309-6316 or 704 410-4760). Mizuho Securities USA Inc. and SMBC Nikko Securities America, Inc. are the co-dealer managers.

The information agent and depositary is D.F. King & Co., Inc. (212 269-5550, 888 887-1266 or aflac@dfking.com).

The Columbus, Ga.-based company provides supplemental health and life insurance.

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