Verizon buys $6.43 million more notes in tender since early deadline

By Susanna Moon

Chicago, April 2 – Verizon Communications Inc. said it took in tenders for another $6,426,000 of two series of notes in the tender offers that ended at 11:59 p.m. ET on March 30.

As announced March 5, Verizon was holding separate cash tender offers to repurchase up to a total of $3 billion of its notes from 13 series.

The series are divided into two sets, with nine series comprising the group 1 notes and four series comprising the group 2 notes with a cap using a waterfall method to accept notes on a priority basis.

Originally, Verizon planned to repurchase up to $1.5 billion of notes from each group.

In the group 1 offers Verizon paid total cash of about $1.9 billion.

The company said on March 19 that it lifted the waterfall cap in the first set of tender offers so that it could accept for purchase all of the 2.946% notes due 2022 tendered by the early deadline of 5 p.m. ET on March 16.

Verizon exercised its option to settle early tendered notes on March 20, with the final settlement date set for April 3, according to a press release.

Group 1 notes

The early tender count was as follows for the group 1 notes, listed in order of acceptance priority:

• $1,909,019,000, or 59.76%, of the $3,194,253,000 2.946% notes due 2022 at a total purchase price of $990.67 per $1,000 principal amount, with pricing set using the 2.625% Treasury note due Feb. 28, 2023 plus 55 basis points;

• $426.61 million, or 31.96%, of the $1,344,842,000 4.6% notes due 2021;

• $353,562,000, or 21.71%, of the $1,628,716,000 3.5% notes due 2021;

• $322,843,000, or 37.47%, of the $861,617,000 3.45% notes due 2021;

• $859,874,000, or 46.48%, of the $1.85 billion 3.125% notes due 2022;

• $295,985,000, or 24.12%, of the $1,226,930,000 3% notes due 2021;

• $195,964,000, or 13.38%, of the $1,464,954,000 2.45% notes due 2022;

• $158,309,000, or 18.12%, of the $873,757,000 1.75% notes due 2021; and

• $408,192,000, or 29.16%, of the $1.4 billion floating-rate notes due 2022.

Group 2 notes

After the early deadline, the company accepted for purchase another $6,326,000 of the 4.672% notes due 2055 at a purchase price of $890.47 per $1,000 principal amount and another $100,000 of the 5.012% notes due 2054 at a price of $947.30 per $1,000 principal amount.

The early tenders for the group 2 notes are as follows, with the notes listed in order of acceptance:

• $424,359,000, or 7.72%, of the $5,499,999,000 4.672% notes due 2055 at a total purchase price of $940.47 per $1,000 principal amount with pricing set using the 2.75% Treasury note due Nov. 15, 2047 plus 195 bps;

• $246.18 million, or 4.92%, of the $5 billion 4.522% notes due 2048 at a total purchase price of $943.80 per $1,000 principal amount using the 2.75% Treasury note due Nov. 15, 2047 plus 180 bps;

• $163,916,000, or 2.98%, of the $5.5 billion 5.012% notes due 2054 at a total purchase price of $997.30 per $1,000 principal amount with pricing set using the 2.75% Treasury note due Nov. 15, 2047 plus 195 bps; and

• $130,868,000, or 3.21%, of the $4,072,197,000 5.012% notes due 2049 at a total purchase price of $1,103.25 per $1,000 principal amount with pricing set using the 2.75% Treasury note due Nov. 15, 2047 plus 185 bps.

For each series, the total amount will include an early tender premium of $50 per $1,000 of notes tendered by the early deadline, 5 p.m. ET on March 16.

Because the tender cap was reached for the group 1 offers as of the early deadline, no additional tenders were accepted for purchase after the early deadline.

The cap for the group 2 offers had not been met as of the previous update on March 19.

Citigroup Global Markets Inc. (800 558-3745 or 212 723-6106), Goldman Sachs & Co. LLC (800 828-3182 or 212 577-1452) and J.P. Morgan Securities LLC (866 834-4666 or 212 834-4811) are the lead dealer managers for the offers.

Global Bondholders Services Corp. (866 470-3800 or 212 430-3774) is the information agent for the offers.

Verizon is a New York City-based telecommunications company.

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