UniCredit begins tender offers for 10 series of notes at 50 to 87

By Susanna Moon

Chicago, Jan. 25 - UniCredit SpA said it began cash tender offers for 10 series of notes at 50% to 87% of the liquidation preference or principal amount.

The company may elect to purchase a maximum liquidation preference or principal amount of €3 billion of notes or the sterling equivalent.

The purchase price for the first series of securities, with a priority level of 1, is as follows:

• 50 for €250 million perpetual non-cumulative non-voting fixed-to-floating preferred securities issued by BA-CA Finance (Cayman) Ltd.;

• 50 for €150 million perpetual non-cumulative non-voting fixed-to-floating preferred securities issued by BA-CA Finance (Cayman) (2) Ltd.;

• 71 for €750 million of non-cumulative guaranteed fixed-to-floating perpetual trust preferred securities issued by UniCredito Italiano Capital Trust III;

• 66 for £300 million of non-cumulative guaranteed fixed-to-floating perpetual trust preferred securities issued by UniCredito Italiano Capital Trust IV;

• 79 for €500 million of non-cumulative step-up fixed-to-floating subordinated notes issued by UniCredit SpA;

• 81 for €750 million of non-cumulative step-up fixed-to-floating subordinated guaranteed notes issued by UniCredit International Bank (Luxembourg) SA;

• 72 for £350 million of non-cumulative step-up fixed-to-floating subordinated guaranteed notes issued by UniCredit International Bank (Luxembourg) SA;

The purchase price for the remaining three series of securities, with a priority level of 2, is as follows:

• 87 for €1 billion of upper tier II subordinated 6.7% fixed-rate notes due 2018 issued by UniCredit SpA under its €60 billion euro medium-term note program;

• 86 for €900 million of upper tier II subordinated fixed-rate notes due 2016 issued by UniCredito Italiano SpA under its €50 billion euro medium-term note program;

• 75 for £450 million of upper tier II subordinated fixed-rate notes due 2016 issued by UniCredito Italiano SpA under its €50 billion euro medium-term note program;

The company also will pay accrued dividends or interest up to but not including the settlement date.

Offer details

The offers will run until 11 a.m. ET on Feb. 3. Settlement will occur on Feb. 10.

Holders may submit offers in a minimum liquidation preference or principal amount of €50,000 or £50,000.

If the total liquidation preference or principal amount of priority-one securities tendered exceeds the offer cap, the company may accept the securities on a pro rata basis. If the amount of priority 1 securities tendered falls short of the cap, the company may accept offers for the priority 2 securities on a pro rata basis.

The dealer managers are UniCredit Bank AG (attn: Pietro Bianculli or Caterina Tamborra, +39 02 8862 0639 or +39 02 8862 0628, e-mail pietro.bianculli@unicredit.eu or caterina.tamborra@unicredit.eu), Mediobanca - Banca di Credito Finanziario SpA (attn: DCM FIG team, +39 02 8829984, e-mail DCM_FIG@mediobanca.it), Merrill Lynch International (attn: liability management group - John Cavanagh or Tommaso Gros-Pietro, +44 20 7995 3715 or +44 20 7995 2324, e-mail john.m.cavanagh@baml.com or tommaso.gros-pietro@baml.com) and UBS Ltd. (attn: liability management group, +44 207 567 0525, e-mail: OL-Liability-Management@ubs.com).

The tender agent is Lucid Issuer Services Ltd. (attn: Paul Kamminga or Sunjeeve Patel, +44 0 20 7704 0880, e-mail: unicredit@lucid-is.com).

The purpose of the offers is in line with UniCredit Group's strategy for optimizing its capital structure, according to a company press release.

The acquisition of securities under the offer will generate profits and thereby increase core tier 1 capital as well as reduce interest costs, the company said.

The offers also give investors an opportunity to "realize upon their investments at a premium to secondary market prices" and provide liquidity to the market, the release noted.

UniCredit Bank Austria AG decided not to exercise its call rights on the BA-CA 1 securities, exercisable on April 28, and on the BA-CA 2 securities, exercisable on March 22.

There have been no other decisions about calling the remaining securities, the company noted.

UniCredit SpA is Milan, Italy-based financial holding company.

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