McKesson gives oversubscribed early tender results, will raise cap

Chicago, July 22 – McKesson Corp. announced the early results of its capped tender offer for what was initially up to $500 million of notes from seven series, according to a press release on Thursday.

The company received tenders for a total of $922,154,000 principal amount of notes by the 5 p.m. ET deadline on July 21.

The company currently intends to increase the tender cap to accept for purchase all notes tendered by the early deadline.

Tender results

The company received the following amounts of tenders for the seven series in the offer:

• $66,483,000, or 23.2%, of the $286,078,000 outstanding 6% notes due 2041 (Cusip: 58155QAE3) with pricing to be based on the 2.25% U.S. Treasury due May 15, 2041 plus 120 basis points;

• $156,583,000, or 38.1%, of the $411,425,000 outstanding 4.883% notes due 2044 (Cusip: 581557BC8) with pricing to be based on the 2.25% U.S. Treasury due May 15, 2041 plus 112 bps;

• $16,788,000, or 10.1%, of the $166,596,000 outstanding 7.65% debentures due 2027 (Cusip: 581557AM7) with pricing to be based on the 0.875% U.S. Treasury due June 30, 2026 plus 75 bps;

• $203,616,000, or 50.9%, of the $400 million outstanding 4.75% notes due 2029 (Cusip: 581557BN4) with pricing to be based on the 1.625% U.S. Treasury due May 15, 2031 plus 40 bps;

• $256,749,000, or 42.8%, of the $600 million outstanding 3.95% notes due 2028 (Cusip: 581557BJ3) with pricing to be based on the 1.625% U.S. Treasury due May 15, 2031 plus 10 bps;

• $40,005,000, or 10%, of the $400 million outstanding 2.85% notes due 2023 (Cusip: 58155QAG8) with pricing to be based on the 0.125% U.S. Treasury due June 30, 2023 plus 30 bps; and

• $181.93 million, or 16.5%, of the $1.1 billion outstanding 3.796% notes due 2024 (Cusip: 581557BE4) with pricing to be based on the 0.25% U.S. Treasury due June 15, 2024 plus 20 bps.

An early tender consideration of $50 per $1,000 note will be paid to noteholders who tendered by the early expiration time.

Pricing will be determined at 10 a.m. ET on July 22.

Noteholders will also be paid interest to the settlement date.

Details

The offer will technically expire at 11:59 p.m. ET on Aug. 4. However, no notes tendered after the early deadline will be accepted for purchase.

Barclays (212 528-7581, 800 438-3242) and Citigroup Global Markets Inc. (800 558-3745, 212 723-6106) are the lead dealer managers for the offer.

Wells Fargo Securities, LLC is the co-dealer manager.

Global Bondholder Securities Corp. (866 924-2200, contact@gbsc-usa.com) is the tender agent and information agent.

McKesson is a San Francisco-based health care services and information technology company.

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