Sweden’s SKF to pay €279.37 million in tender for 2.375%, 1.875% notes

By Susanna Moon

Chicago, Sept. 13 – SKF AB said investors had tendered €193.38 million of its 2.375% notes due 2020 and €74,048,000 of its 1.875% notes due 2019.

As announced Sept. 4, the issuer was tendering for up to €300 million of the two series, consisting of its €449,999,000 of outstanding €750 million 2.375% notes and its €265,853,000 of outstanding €500 million 1.875% notes, until 11 a.m. ET on Sept. 12.

The aggregate purchase amount will be €279,368,701, according to a company update on Thursday.

Pricing for each €1,000 principal amount was set as follows, using a purchase yield assuming a settlement date of Sept. 17, with the notes listed in order of priority acceptance levels:

• Negative 0.15% for the 2.375% notes for a purchase price of €1,053.53; and

• Negative 0.3% for the 1.875% notes for a purchase price of €1,021.46.

Holders also will receive accrued interest.

After settlement, there will be €191,805,000 of the 2019 notes left outstanding and €256,619,000 of the 2020 notes left outstanding.

The purpose of the offers along with a planned issue of new euro-denominated fixed rate notes is “to extend the company’s debt maturity profile in an efficient manner,” according to a previous company announcement.

The tender was contingent on issue of the new notes, which has been met.

“The offers are also being made as part of the company’s liability management and are aimed at optimizing its cost of debt and, furthermore, providing liquidity to those holders whose notes are accepted in the offers.”

The dealer managers are Citigroup Global Markets Ltd. (+44 20 7986 8969 or liabilitymanagement.europe@citi.com) and Commerzbank AG (+49 69 136 59920 or liability.management@commerzbank.com). The tender agent is Citibank, NA, London Branch (+44 20 7508 3867 or exchange.gats@citi.com).

As previously announced, SKF was tendering for up to €300 million of three series of notes in an offer that ended at 11 a.m. ET on May 16.

Investors had tendered €445,189,000 of the €750 million 2.375% notes due 2020, which has priority over the other two note series, as well as €29,708,000 of its €233.61 million 3.875% notes due 2018 and €69,368,000 of its €265,853,000 1.875% notes due 2019.

SKF decided to accept €300,001,000 of the 2.375% notes due 2020 using a scaling factor of 69.7467%.

After settlement on May 22, there was €449,999,000 of the 2.375% notes left outstanding.

The purchase price will be €1,079.09 for each €1,000 principal amount for an aggregate purchase amount of €323,728,079.09.

SKF makes ball and roller bearings and sealing systems. The company is based in Gothenburg, Sweden.

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