PulteGroup buys back $500 million of notes in three tender offers

By Angela McDaniels

Tacoma, Wash., Oct. 21 - PulteGroup, Inc. received tenders for $600.84 million of notes and accepted $500 million of them for purchase, according to a company news release.

The company began three separate offers on Sept. 22, and they each expired at midnight ET on Oct. 20.

In the first offer, the company offered to purchase any and all of its $225,215,000 of 6¼% notes due 2013 and subsidiary Centex Corp.'s $269,916,000 of 5 1/8% notes due 2013.

Holders tendered $162,471,000 principal amount, or 72.14%, of the 6¼% notes and $104,749,000 principal amount, or 38.81%, of the 5 1/8% notes.

For each $1,000 principal amount, the purchase price is $1,060.00 for the 6¼% notes and $1,047.50 for the 5.125% notes.

The second offer was for PulteGroup's $463,996,000 of 5¼% notes due 2014 and Centex's $350 million 5.7% notes due 2014. The amount of notes purchased in this offer is subject to a cap of $232.78 million, which is equal to $500 million minus the amount of notes purchased in the first offer.

Holders tendered $128,077,000 principal amount, or 27.6%, of the 5¼% notes and $31,329,000 principal amount, or 8.95%, of the 5.7% notes, and all of them were accepted for purchase.

For each $1,000 principal amount, the purchase price is $1,025.00 for the 5¼% notes and $1,047.50 for the 5.7% notes.

Finally, the company held a Dutch auction tender offer for its $292,865,000 of 5.2% notes due 2015 and Centex's $450 million of 5¼% notes due 2015. The amount of notes purchased in this offer is subject to a cap of $73,374,000, which is equal to $500 million minus the amount of notes purchased in the first and second offers.

Holders tendered $118.44 million of the 5.2% notes and $55,774,000 of the 5¼% notes. The company accepted for purchase $47,838,000 of the 5.2% notes and $25,536,000 of the 5¼% notes. These amounts represent 16.33% and 5.67% of the outstanding principal amount of the 5.2% notes and 5¼% notes, respectively.

For each $1,000 principal amount, the purchase price is $990 for the 5.2% notes and $1,020 for the 5¼% notes.

The bid price range was $965 to $995 for the 5.2% notes and $995 to $1,025 for the 5¼% notes.

Each of the purchase prices and bid prices noted above includes an early tender payment of $30.00 for notes tendered by 5 p.m. ET on Oct. 5, the early tender date.

The company will also pay accrued interest up to but excluding the settlement date, which was expected to be Oct. 21.

Of the notes tendered in the first offer, $162.42 million of the 6¼% notes and $89,741,000 of the 5 1/8% notes were tendered by the early tender date. The company exercised its option to accept these notes for early settlement, and they were purchased on Oct. 6.

The tender offers are being funded from the company's available cash balance, which was $2.7 billion as of June 30.

The company noted that when it issued the 6¼% notes, 5¼% notes and 5.2% notes, it was known as Pulte Homes, Inc.

The dealer managers were Barclays Capital Inc. (800 438-3242 or 212 528-7581), BNP Paribas Securities Corp. (888 210-4358 or 212 841-3059) and RBS Securities Inc. (877 297-9832 or 203 897-6145). D.F. King & Co., Inc. (212 269-5550 or 800 487-4870) was the information agent.

PulteGroup is a Bloomfield Hills, Mich.-based homebuilder.

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