Zions gets $276.06 million early tenders in offer for 4%, 4.5% notes

By Jennifer Chiou

New York, Sept. 30 – Zions Bancorp announced the early results of its waterfall tender offer and also set pricing for those notes.

The company took in tenders for a total of $276,056,000 of the waterfall notes by the early deadline, including $109,088,000, or 55%, of its $198,448,000 of outstanding 4% senior notes due June 20, 2016 and $166,968,000, or 56%, of its $300 million of outstanding 4.5% senior notes due June 13, 2023.

The cap for the waterfall offer is $263,857,000.

As previously reported, the cap is equal to $500 million less the principal amount of notes accepted in the any and all offer that closed at 5 p.m. ET on Sept. 23.

Zions will pay a total consideration of $1,070.56 for each $1,000 principal amount of its 4.5% senior notes due March 27, 2017 in the any and all tender offer for the $400 million of outstanding notes. The company received overall tenders for $236,143,000 of the notes.

Waterfall offer pricing

For each $1,000 principal amount, the company will pay a total consideration of $1,051.98 for the 4% notes and $1,075.20 for the 4.5% notes due 2023, each including an early tender premium of $30.00 for those who participated prior to 5 p.m. ET on Sept. 29, the early tender time.

The payments were determined by reference to the 0.5% Treasury note due Aug. 31, 2016 plus 40 bps for the 4% notes and the 2.375% Treasury note due Aug. 15, 2024 plus 100 bps for the 4.5% notes due 2023.

There was no early tender premium in the any and all tender offer for the 4.5% notes due 2017.

Acceptance of the tendered waterfall notes will be subject to a priority level, which is 1 for the 4% notes and 2 for the 4.5% notes due 2023. Because the cap has been reached, the 4.5% notes due 2023 will have a proration factor of 92.76%, and the company will not accept any waterfall notes tendered after the early tender time.

The waterfall tender offer will expire at 11:59 p.m. ET on Oct 10.

Deutsche Bank Securities Inc. (866 627-0391 or 212 250-2955) and Goldman Sachs & Co. (800 828-3182 or 212 902-5183) are the dealer managers. Global Bondholder Services Corp. (866 470-3800) is the depositary and information agent.

The bank holding company is based in Salt Lake City.

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