Merck begins tender offers for $4.76 billion of eight note series

By Susanna Moon

Chicago, Oct. 6 – Merck & Co., Inc. said it began tender offers for about $4.76 billion of outstanding principal amount of eight series of notes.

Pricing for the first three series of notes will be set at 2 p.m. ET on Oct. 14 using the 2.375% Treasury notes due Aug. 15, 2024 plus a fixed spread as follows:

• $250 million 6.3% debentures due 2026 will be 70 basis points;

• $500 million 6.4% debentures due 2028 will be 90 bps; and

• $500 million 5.95% debentures due 2028 will be 95 bps.

The next five series of notes will be priced using the 3.375% Treasury notes due May 15, 2044 plus a fixed spread as follows:

• $1.15 billion 6.5% senior notes due 2033 will be 60 bps;

• $500 million 5.75% notes due 2036 will be 65 bps;

• $112,947,000 5.76% notes due 2037 will be 80 bps;

• $1 billion 6.55% senior notes due 2037 will be 80 bps;

• $750 million 5.85% notes due 2039 will be 80 bps.

Price will be set using the bid-side yield to maturity of the U.S. Treasury reference security plus the fixed spread.

The company also will pay accrued interest to but excluding the settlement date.

The hypothetical purchase price for each $1,000 principal amount is $1,296.52 for the 6.3% notes, $1,327.79 for the 6.4% notes, $1,285.32 for the 5.95% notes, $1,377.17 for the 6.5% notes, $1,294.07 for the 5.75% notes, $1,272.89 for the 5.76% notes, $1,394.31 for the 6.55% notes and $1,302.67 for the 5.85% notes.

Pricing for the hypothetical amounts was set at 2 p.m. ET on Oct. 3 and assuming a hypothetical settlement date of Oct. 15.

The tender offers will run until 5 p.m. ET on Oct. 14.

Tendered notes may be withdrawn at any time before the offers expire.

The offers are conditioned on closing of the company’s euro-denominated senior notes offering.

Citigroup Global Markets Inc. (800 558-3745 or 212 723-6106 collect) and J.P. Morgan Securities LLC (866 834-4666 or 212 834-4811 collect) are the lead dealer managers. Global Bondholder Services Corp. (866 470-4200) is the tender agent and information agent.

The health care company is based in Whitehouse Station, N.J.

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