AIG increases cap of tender offer for 13 series to $1.5 billion

By Marisa Wong

Los Angeles, Nov. 21 – American International Group, Inc. announced the early results and an upsizing of its Nov. 6 cash tender offer to buy notes from 13 series for up to $1 billion (excluding accrued interest). AIG increased the tender cap to $1.5 billion, according to a Tuesday press release.

As of 5 p.m. ET on Nov. 20, the early participation date, holders had tendered $3,350,031,000 aggregate principal amount of dollar-denominated securities and €524,765,000 aggregate principal amount of euro-denominated securities.

Specifically, holders had tendered the following as of the early participation date, with the series listed in order of acceptance priority level:

• $853,854,000 of the $1 billion outstanding 2.5% notes due June 30, 2025 (Cusip: 026874DQ7), with pricing to be based on the 4.625% U.S. Treasury note due June 30, 2025 plus a fixed spread of 35 basis points;

• $513.84 million of the $750 million outstanding 3.9% notes due April 1, 2026 (Cusip: 026874DH7), with pricing to be based on the 4.625% U.S. Treasury note due Oct. 15, 2026 plus a fixed spread of 60 bps;

• €524,765,000 of the €1 billion outstanding 1.875% notes due June 21, 2027 (Cusip: AN6673288), with pricing to be based on the interpolated rate plus a fixed spread of 50 bps;

• $159,634,000 of the $341 million outstanding 4.2% notes due April 1, 2028 (Cusip: 026874DH7), with pricing to be based on the 4.875% U.S. Treasury note due Oct. 31, 2028 plus a fixed spread of 90 bps;

• $31,966,000 of the $166.4 million outstanding 8.175% series A-6 junior subordinated debentures due May 15, 2058 with a first call date of May 15, 2038 (Cusip: 026874BS5), with pricing to be based on the 3.875% U.S. Treasury note due Aug. 15, 2033 plus a fixed spread of 200 bps;

• $34,257,000 of the $143.4 million outstanding 6.82% notes due Nov. 15, 2037 (Cusip: 026874CW5), with pricing to be based on the 3.875% U.S. Treasury note due Aug. 15, 2033 plus a fixed spread of 180 bps;

• $14,016,000 of the $37.7 million outstanding 6.25% series A-1 junior subordinated debentures due March 15, 2037 (Cusip: 026874BE6), with pricing to be based on the 3.875% U.S. Treasury note due Aug. 15, 2033 plus a fixed spread of 200 bps;

• $35,449,000 of the $246.4 million outstanding 4.375% notes due Jan. 15, 2055 (Cusip: 026874DB0), with pricing to be based on the 3.625% U.S. Treasury note due May 15, 2053 plus a fixed spread of 155 bps;

• $180,129,000 of the $584.3 million outstanding 6.25% notes due May 1, 2036 (Cusip: 026874AZ0), to be repurchased at a price calculated using the 3.875% U.S. Treasury due Aug. 15, 2033 plus 145 bps;

• $332,962,000 of the $750 million outstanding 4.8% notes due July 10, 2045 (Cusip: 026874DF1), to be repurchased at a price calculated using the 4.375% U.S. Treasury due Aug. 15, 2043 plus 110 bps;

• $527,579,000 of the $1 billion outstanding 4.375% notes due June 30, 2050 (Cusip: 026874DP9), to be repurchased at a price calculated using the 3.625% U.S. Treasury due May 15, 2053 plus 115 bps;

• $520,122,000 of the $1 billion outstanding 4.75% notes due April 1, 2048 (Cusip: 026874DL8), to be repurchased at a price calculated using the 3.625% U.S. Treasury due May 15, 2053 plus 125 bps; and

• $146,223,000 of the $746.6 million outstanding 4.5% notes due July 16, 2044 (Cusip: 026874DA2), to be repurchased at a price calculated using the 4.375% U.S. Treasury due Aug. 15, 2043 plus 120 bps.

The purchase prices include an early tender premium of $30 or €30 for each $1,000 or €1,000 principal amount of notes tendered by the early participation date, which was also the withdrawal deadline.

Pricing was to be set at 10 a.m. ET on Nov. 21.

The company expects to settle the early tendered notes accepted for purchase on Nov. 22.

The offer will expire at 5 p.m. ET on Dec. 6. However, because the aggregate purchase price of the securities tendered by the early participation date will exceed the tender cap, the company does not expect to accept any further tenders of securities.

BofA Securities, Inc. (888 292-0070, 980 387-3907 or +44 20 7996 5420), Citigroup Global Markets Inc. (800 558-3745 or 212 723-6106) and U.S. Bancorp Investments, Inc. (800 479-3441 or 917 558-2756) are the joint lead dealer managers.

BNP Paribas Securities Corp., SG Americas Securities, LLC and SMBC Nikko Securities America, Inc. are working as co-dealer managers.

Ipreo LLC (888 593-9546, 212 849-3880, ipreo@tenderoffer@ihsmarkit.com) is the tender and information agent.

AIG is a New York-based insurance provider.

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