Swiss Re gives early results of capped tender offer for five series

By Marisa Wong

Los Angeles, Oct. 17 – Swiss Re Finance (Luxembourg) SA announced the early results of its Oct. 2 offer to purchase for cash notes from five series, up to a capped maximum amount of $1,131,200,000.

The offer was oversubscribed as of 5 p.m. ET on Oct. 16, the early tender date, according to a Tuesday press release.

As previously announced, the capped maximum amount was set equal to $1.5 billion (equivalent) less the aggregate nominal amount of 4.25% perpetual notes tendered and accepted for purchase under the concurrent any-and-all tender offer.

Because the aggregate amount of early tendered notes under the capped offer exceeds the maximum amount, the company will accept early tenders for three of the series in full without proration, early tenders of one of the series subject to a scaling factor and none of the early tenders of the remaining series.

In addition, no further notes tendered under the capped offer after the early deadline will be accepted for purchase. All notes tendered on or before the early tender date have priority in acceptance over notes tendered after the early deadline.

Swiss Re Finance accepted the following early tendered amounts, with the notes listed in order of acceptance priority:

• All $376,994,000 tendered of the $400 million outstanding 6.05% non-step-up callable notes due Feb. 15, 2056 with a first call date on Feb. 15, 2031 (ISIN: XS1389124774) issued by Argentum Netherlands BV (formerly known as Demeter Investments BV) at a fixed price of $930 per $1,000 principal amount;

• All €211.5 million tendered of the €750 million outstanding 2.534% guaranteed subordinated fixed-rate reset step-up callable notes due April 30, 2050 with a first call date on April 30, 2030 (ISIN: XS1963116964) issued by Swiss Re Finance and guaranteed by Swiss Reinsurance Co. Ltd. at a price to be calculated based on the interpolated swap rate and a fixed spread of 145 basis points;

• All $295,785,000 tendered of the $750 million outstanding 5.524% perpetual fixed-spread callable notes with a first call date on Aug. 15, 2022 and next callable on Aug. 15, 2027 (ISIN: XS1640851983) issued by Argentum Netherlands at a fixed price of $930 per $1,000 principal amount;

• $234.2 million of the $377.8 million tendered, with a scaling factor of 68.42% applied, of the $1 billion outstanding 5% subordinated fixed-rate reset step-up callable notes due April 2, 2049 with a first call date on April 2, 2029 (ISIN: XS1973748707, US87089NAA81) issued by Swiss Re Finance and guaranteed by Swiss Reinsurance at a price based on the 4.375% U.S. Treasury due Aug. 31, 2028 and a fixed spread of 115 bps; and

• None of the $475,242,000 tendered of the $700 million outstanding 5.75% fixed-to-floating rate non step-up callable notes due Aug. 15, 2050 with a first call date on Aug. 15, 2025 (ISIN: XS1261170515) issued by Argentum Netherlands at a price based on the 5% U.S. Treasury due Aug. 31, 2025 and a fixed spread of 180 bps.

Pricing for the 2.534% notes and 5% notes was scheduled to be determined at 10 a.m. ET on Oct. 17.

Tenders may no longer be withdrawn.

Settlement for the early tendered notes under the capped offer is expected to be on Oct. 18.

The capped offer will expire at 5 p.m. ET on Oct. 31. Final settlement had been slated for Nov. 2, but no additional notes will be accepted for purchase.

Any-and-all offer

Also on Oct. 2, Swiss Re Finance had begun an offer to purchase for cash any and all of its $1 billion outstanding 4.25% perpetual subordinated fixed-spread callable notes (ISIN: XS2049422343) guaranteed by Swiss Reinsurance.

As of the expiration of the any-and-all offer at 5 p.m. ET on Oct. 6, holders had tendered $368.8 million, or 36.88%, of the outstanding 4.25% notes. The company accepted for purchase all of the tendered notes, leaving $631.2 million principal amount outstanding.

None of the 4.25% notes were tendered under guaranteed delivery procedures.

Swiss Re Finance purchased the 4.25% notes at a fixed price of $965 per $1,000 principal amount. Settlement of the any-and-all offer was on Oct. 12.

Given the results of the any-and-all offer for the 4.25% notes, the company then set the capped maximum amount for the concurrent capped tender offer.

Details

For each offer, in addition to the purchase price, the company also paid or will pay accrued interest.

The purpose of the offers is to proactively manage the group’s subordinated debt portfolio and to reduce its future interest expense.

The dealer managers are BofA Securities Europe SA (+33 1 87 70 10 57; 888 292-0070 or 980 387-3907; DG.LM-EMEA@bofa.com) and HSBC Bank plc (+44 20 7992 6237; 888 HSBC-4LM or 212 525-5552; liability.management@hsbcib.com).

The information and tender agent is D.F. King (+44 20 7920 9700; 212 269-5550 or 800 848-2998; swissre@dfkingltd.com; https://sites.dfkingltd.com/swissre).

The Swiss Re group is a reinsurance company based in Zurich.

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