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Mutual of Omaha sets pricing, tallies early tenders for surplus notes
By Susanna Moon
Chicago, July 14 – Mutual of Omaha Insurance Co. said it priced the tender offer for its $296.88 million of outstanding 6.8% surplus notes and its $300 million of 6.95% surplus notes due 2040.
As of 5 p.m. ET on July 11, the early tender date, investors had tendered $36.42 million, or 12.27%, of its 6.8% notes and $133.27 million, or 44.42%, of its 6.95% notes.
The offer will continue until 11:59 p.m. ET on July 25.
The company said on June 27 that it began a tender offer for up to $300 million of its outstanding 6.8% notes and 6.95% notes, listed in order of priority.
Pricing was set at 2 p.m. ET on July 14 using the 3.625% Treasury due Feb. 15, 2044 plus a spread of 125 bps for the 6.8% notes and the 3.625% Treasury due Feb. 15, 2044 plus a spread of 130 bps for the 6.95% notes, as previously announced.
The total purchase price for each $1,000 principal amount will be $1,300.16 for the 6.8% notes and $1,344.81 for the 6.95% notes. The reference yield was 3.359% for the 6.8% notes and 3.359% for the 6.95% notes; the yield was set at 4.609% for the 6.8% notes and 4.659% for the 6.95% notes.
The total amount for each $1,000 principal amount includes an early tender payment of $50.00 for notes tendered by the early deadline.
The company also will pay accrued interest.
Early settlement has been slated for July 17.
The total tender payment was hypothetically set at $1,303.46 for the 6.8% notes and $1,348.56 for the 6.95% notes using the pricing date of June 26.
Goldman, Sachs & Co. (800 828-3182 or call collect 212 902-5183) and J.P. Morgan Securities LLC (866 834-4666 or 212 834-4811) are the dealer managers. D.F. King & Co., Inc. is the tender agent and information agent (800 967-5079).
The insurance and financial services provider is based in Omaha.
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