Pitney Bowes prices, gives early results in tender for $500 million notes

By Toni Weeks and Jennifer Chiou

New York, March 17 - Pitney Bowes Inc. set the pricing and reported the early results for its cash tender offer for up to $500 million of notes.

As stated, the company is tendering for up to $500 million principal amount of five series of its outstanding notes, listed below in order of priority acceptance level.

Covered by the tender offer are the $500 million 5.25% notes due 2037, $500 million 5.75% notes due 2017, $370,914,000 4.75% notes due 2016, $350 million 4.75% notes due 2018 and $250 million 5.6% notes due 2018, according to a company press release.

As previously reported, for the 5.25% notes, the total purchase price will be $1,110, including a $30.00 premium, per $1,000 principal amount of notes tendered by 5 p.m. ET on March 17, the early tender date.

As of the early deadline, holders had tendered $384,959,000 of the 5.25% notes, $135,918,000 of the 5.75% notes, $77,715,000 of the 4.75% notes due 2016, $70,992,000 of the 4.75% notes due 2018 and $44,299,000 of the 5.6% notes.

Pricing for the other series of notes, with priority levels 2 through 5, was set at 2 p.m. ET on March 17 using a reference security plus a fixed spread. Per $1,000 principal amount of notes, the total consideration for each note series is as follows:

• $1,139.36 for the 5.75% notes using the 0.625% U.S. Treasury note due Feb. 15, 2017 plus 90 basis points;

• $1,077.66 for the 4.75% notes due 2016 using 0.375% U.S. Treasury note due Jan. 15, 2016 plus 15 bps;

• $1,092.28 for the 4.75% notes due 2018 using 1.5% U.S. Treasury note due Feb. 28, 2019 plus 85 bps; and

• $1,120.95 for the 5.6% notes using 1.5% U.S. Treasury note due Feb. 28, 2019 plus 85 bps.

The total purchase price includes an early tender premium of $30.00 per $1,000 of notes.

Those who tender after the early deadline will receive the total payment less the early premium.

The company also will pay accrued interest to but excluding the settlement date, which will be March 18 for early tendered notes and April 1 for other tenders.

The company said that it expects to accept all tenders for the priority one and two notes, with the second-priority notes prorated. It added that it doesn't expect to accept any other series.

The tender offer will end at 11:59 p.m. ET on March 31.

Tendered notes may be withdrawn by the early tender date.

The company plans to fund the offer with proceeds of a new issue of debt.

Goldman, Sachs, & Co. (800 828-3182 or 212 902-6941 collect) and J.P. Morgan Securities LLC 866 834-4666 or 212-834-4811 collect) are the lead dealer managers. Global Bondholder Services Corp. (banks and brokers 212 430-3774, all others 866 924-2200) is the tender agent.

Pitney Bowes is a Stamford, Conn.-based provider of postage equipment and services.

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