Macy’s prices tender, ups cap to $525 million, gives early tally

By Wendy Van Sickle

Columbus, Ohio, Dec. 17 – Macy’s, Inc. announced the pricing, early results and upsizing of wholly owned subsidiary Macy’s Retail Holdings, Inc.’s cash tender offer to purchase a maximum amount of outstanding debt securities from 15 series.

Macy’s has increased the maximum tender amount to $525 million from $450 million, according to a Tuesday press release.

As of 5 p.m. ET on Dec. 16, the early tender date, holders had tendered about $1.82 billion of notes.

Specifically, holders had tendered the following, with the notes listed in order of acceptance priority:

• $189,827,000 of the $400 million of 4.375% senior notes due 2023, all of which will be accepted for purchase with no proration. Pricing was set at $1,039.85 per $1,000 principal amount using the 1.5% Treasury due Nov. 30, 2024 plus 145 basis points;

• $256,089,000 of the $750 million of 2.875% senior notes due 2023, $110,168,000 of which will be accepted for purchase at a proration factor of 43.1%. Pricing was set at $994.80 per $1,000 principal amount using the 1.5% Treasury due Nov. 30, 2024 plus 135 bps;

• $226,253,000 of the $550 million of 3.875% senior notes due 2022, $99,997,000 of which will be accepted for purchase at a proration factor of 44.3%. Pricing was set at $1,023.40 per $1,000 principal amount using the 1.625% Treasury due Nov. 15, 2022 plus 90 bps;

• $112,599,000 of the $191,796,000 of 6.9% senior debentures due 2029, all of which will be accepted for purchase with no proration. Pricing was set at $1,133.71 per $1,000 principal amount using the 1.75% Treasury due Nov. 15, 2029 plus 320 bps;

• $27,984,000 of the $116,557,000 of 7% senior debentures due 2028, $12,409,000 of which will be accepted for purchase at a proration factor of 44.5%. Pricing was set at $1,137.94 per $1,000 principal amount using the 1.75% Treasury due Nov. 15, 2029 plus 305 bps;

• $10,213,000 of the $71,167,000 of 6.79% senior debentures due 2027, none of which will be accepted for purchase. Pricing was to be based on the 1.75% Treasury due Nov. 15, 2029 plus 300 bps;

• $20,548,000 of the $102,897,000 of 6.7% senior debentures due 2028, none of which will be accepted for purchase. Pricing was to be based on the 1.75% Treasury due Nov. 15, 2029 plus 305 bps;

• $73,997,000 of the $192,532,000 of 6.375% senior notes due 2037, none of which will be accepted for purchase. Pricing was to be based on the 2.25% Treasury due Aug. 15, 2049 plus 340 bps;

• $163,445,000 of the $200,803,000 of 6.7% senior debentures due 2034, none of which will be accepted for purchase. Pricing was to be based on the 1.75% Treasury due Nov. 15, 2029 plus 355 bps;

• $13,158,000 of the $121,587,000 of 6.65% senior debentures due 2024, none of which will be accepted for purchase. Pricing was to be based on the 1.5% Treasury due Nov. 30, 2024 plus 200 bps;

• $186,159,000 of the $500 million of 3.45% senior notes due 2021, none of which will be accepted for purchase. Pricing was to be based on the 1.5% Treasury due Nov. 30, 2021 plus 70 bps;

• $206,352,000 of the $500 million of 3.625% senior notes due 2024, none of which will be accepted for purchase. Pricing was to be based on the 1.5% Treasury due Nov. 30, 2024 plus 170 bps;

• $172,113,000 of the $366.62 million of 4.5% senior notes due 2034, none of which will be accepted for purchase. Pricing was to be based on the 1.75% Treasury due Nov. 15, 2029 plus 325 bps;

• $74,838,000 of the $250 million of 5.125% senior notes due 2042, none of which will be accepted for purchase. Pricing was to be based on the 2.25% Treasury due Aug. 15, 2049 plus 345 bps; and

• $88,359,000 of the $250 million of 4.3% senior notes due 2043, none of which will be accepted for purchase. Pricing was to be based on the 2.25% Treasury due Aug. 15, 2049 plus 345 bps.

As announced on Dec. 3, the 4.375% senior notes due 2023 and 2.875% senior notes due 2023 are subject to a combined tender sub-cap of $300 million, and the 3.875% senior notes due 2022 are subject to a tender sub-cap of $100 million. Those sub-caps were not affected by the overall tender cap increase, the company noted.

Holders who tendered their notes by the early tender date will be eligible to receive a $30.00 early tender premium per $1,000 of notes.

Pricing was determined at 10 a.m. ET on Dec. 17.

Holders will also receive accrued interest to but excluding the settlement date. The early settlement date will be Dec. 18.

The tender offer will expire at 11:59 p.m. ET on Dec. 31. However, because early tenders already exceeded the maximum tender amount, the company does not expect to accept for purchase any additional tenders.

Tenders may no longer be withdrawn.

The dealer managers for the tender offer are BofA Securities, Inc. (888 292-0070 or 980 387-3907), Credit Suisse Securities (USA) LLC (800 820-1653), U.S. Bancorp Investments, Inc. (877 558-2607) and Wells Fargo Securities, LLC at (866 309-6316).

The tender agent and information agent is D.F. King & Co., Inc. (877 864-5057, 212 269-5550 or macys@dfking.com).

Macy’s is a department store chain based in Cincinnati.

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