Brazil’s Vale buys no more notes in $1 billion offer since early date

By Susanna Moon

Chicago, Dec. 11 – Vale SA and wholly owned subsidiary Vale Overseas Ltd. accepted no additional notes in the capped tender offer for five series of notes that ended at 11:59 p.m. ET on Dec. 10, according to a 6-K filing with the Securities and Exchange Commission.

As announced Nov. 9, the companies were tendering for up to a maximum of $1 billion of five series of notes until 11:59 p.m. ET on Dec. 10.

The offer was oversubscribed as of the early deadline of 5 p.m. ET on Nov. 26, however, and the companies accepted for purchase the first two series of notes on a prorated basis and none of the other three series.

Settlement occurred on Nov. 29.

Holders had tendered the following amount of notes as of the early deadline with the total purchase price for each $1,000 principal amount and the notes listed in order of priority acceptance levels:

• $661,259,000 of Vale Overseas' $1,469,049,000 4 3/8% guaranteed notes due 2022 with a total purchase price of $1,024.00 and sub-cap of $400 million;

• $1,154,340,000 of Vale Overseas' $2,409,315,000 6 7/8% guaranteed notes due 2036 with a total purchase price of $1,148.75;

• $770,436,000 of Vale Overseas' $1,594,805,000 6 7/8% guaranteed notes due 2039 with a total purchase price of $1,160.00;

• $1,091,868,000 of Vale Overseas' $2 billion 6¼% guaranteed notes due 2026 with a total purchase price of $1,093.75; and

• $129,103,000 of Vale's $520,405,000 5 5/8% notes due 2042 with a total purchase price of $1,008.75.

The companies accepted for purchase $400 million of the 4 3/8% notes using a proration factor of 60.5% and $600 million of the 6 7/8% notes due 2036 using a proration factor of 52%.

None of the 6 7/8% notes due 2039, 6¼% notes or 5 5/8% notes will be purchased in the offer.

The total amount included an early tender premium of $30.00 per $1,000 principal amount of notes tendered by the early deadline.

Holders also received accrued interest but excluding the settlement date.

BB Securities Ltd. (+44 20 7367 5803 or bbsettlements@bb.com.br), BofA Merrill Lynch (646 855-8988 or 888 292-0070), Banco Bradesco BBI SA (212 888-9145), Credit Agricole Securities (USA) Inc. (212 261‑7802 or 866 807-6030) and HSBC Securities (USA) Inc. (212 525-5552 or 888 HSBC-4LM) are the dealer managers. D.F. King & Co., Inc. (212 269-5550, 888 628-8208, vale@dfking.com or dfking.com/vale) is the tender and information agent.

Vale is a Rio de Janeiro-based metals and mining company.

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