American Express gives early exchange results for 8.125%, 8.15% notes

By Marisa Wong

Madison, Wis., Nov. 28 - American Express Co. said that as of 5 p.m. ET on Nov. 27, the early participation date of its two previously announced exchange offers, holders tendered $1,108,067,000 of its 8.125% senior notes due 2019 and $779,107,000 of its 8.15% senior notes due 2038.

American Express began two separate private offers on Nov. 13 to exchange any and all of its outstanding $1.75 billion of 8.125% senior notes due 2019 for new notes due Dec. 2, 2022 and cash and any and all of its outstanding $1 billion 8.15% of senior notes due 2038 for new notes due Dec. 3, 2042 and cash.

The company priced the exchange offers on Nov. 27.

The total exchange price for the 8.125% notes will be $1,150 principal amount of new 2022 notes plus $239.24 in cash.

Interest on the new 2022 notes was set at 2.65%. The new 2022 issue yield is 2.697%, and the new 2022 notes value will be $1,145.29. Pricing was set at 2 p.m. ET on Nov. 27 using the bid-side yield on the 1.625% U.S. Treasury note due Nov. 15, 2022, which was 1.647%, plus 15 basis points.

The total exchange price for the 8.15% notes will be $1,350 principal amount of new 2042 notes plus $352.75 in cash.

Interest rate on the new 2042 notes will be 4.05%. The new 2042 issue yield is 4.086%, and the new 2042 notes value will be $1,341.64. Pricing was set using the bid-side yield on the 2.75% U.S. Treasury note due Aug. 15, 2042 at pricing, which was 2.786%, plus 105 bps.

Holders who tendered their notes by the early deadline will receive an early exchange premium of $30.00 per $1,000 principal amount of each series of notes accepted for exchange. The early premium is reflected in the total exchange price listed above.

Holders will also receive accrued interest to but not excluding the settlement date, which will be Dec. 3 for notes tendered by the early deadline and Dec. 13 for notes tendered after the early deadline.

The exchange offers will end at 11:59 p.m. ET on Dec. 11.

Tendered notes may no longer be withdrawn.

Each exchange offer is conditioned on a minimum of $500 million principal amount of new notes of each series being issued in exchange for the old notes, according to a prior press release.

The exchange is only being offered to qualified institutional buyers under Rule 144A or to non-U.S. persons under the Securities Act.

D.F. King & Co., Inc. (800 549-6697 or, for banks and brokers, 212 269-5550) is the information agent.

The financial services company is based in New York.

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