Medtronic gives pricing, early tender results for 14 series of notes

By Sarah Lizee

Olympia, Wash., July 10 – Medtronic plc announced on Wednesday the pricing terms and early results of its cash tender offer for notes from 14 series issued by subsidiaries Medtronic Inc., Medtronic Global Holdings SCA and Covidien International Finance SA.

The company reported that as of the early tender deadline, holders had tendered about $642 million in its any-and-all tender offer and about $7.95 billion in aggregate principal amount of the maximum tender offer notes by the July 9 early deadline.

The terms of the tender remain unchanged from the original offer of June 24, except that the size of the tender was raised to $5.525 billion from $4.35 billion.

Pricing was set at 11 a.m. ET on Wednesday. The total consideration per $1,000 note for each series of notes includes an early tender premium of $30.00 per note.

The company said it had accepted the following notes tendered under the capped offer:

• $25,314,000 of $182,949,000 of 6.5% senior notes due 2039 issued by Medtronic for a total consideration of $1,441.66, with pricing based on a fixed spread of 85 bps over the 3% U.S. Treasury due Feb. 15, 2049;

• $81,799,000 of $305.91 million of 5.55% senior notes due 2040 issued by Medtronic for a total consideration of $1,334.85, with pricing based on a fixed spread of 75 bps over the 3% U.S. Treasury due Feb. 15, 2049;

• $794,828,000 of $1,963,341,000 of 4.625% senior notes due 2045 issued by Medtronic for a total consideration of $1,237.73, with pricing based on a fixed spread of 70 bps over the 3% U.S. Treasury due Feb. 15, 2049;

• $150 million of $176,594,000 of 4.625% senior notes due 2044 issued by Medtronic for a total consideration of $1,219.10, with pricing based on a fixed spread of 75 bps over the 3% U.S. Treasury due Feb. 15, 2049;

• $24,123,000 of $128.65 million of 4.5% senior notes due 2042 issued by Medtronic for a total consideration of $1,187.27, with pricing based on a fixed spread of 75 bps over the 3% U.S. Treasury due Feb. 15, 2049;

• $450,003,000 of $2,381,619,000 of 4.375% notes due 2035 issued by Medtronic for a total consideration of $1,163.81, with pricing based on a fixed spread of 50 bps over the 3% U.S. Treasury due Feb. 15, 2049;

• $19,954,000 of $325,024,000 of 4% senior notes due 2043 issued by Medtronic for a total consideration of $1,112.53, with pricing based on a fixed spread of 75 bps over the 3% U.S. Treasury due Feb. 15, 2049;

• $1,300,038,000 of $4 billion of 3.5% senior notes due 2025 issued by Medtronic for a total consideration of $1,068.04, with pricing based on a fixed spread of 40 bps over the 2% U.S. Treasury due May 31, 2024;

• $417,517,000 of $850 million of 3.625% notes due 2024 issued by Medtronic for a total consideration of $1,061.20, with pricing based on a fixed spread of 35 bps over the 2% U.S. Treasury due May 31, 2024;

• $30,319,000 of $283,536,000 of 6.55% senior notes due 2037 issued by Covidien for a total consideration of $1,442.64, with pricing based on a fixed spread of 75 bps over the 3% U.S. Treasury due Feb. 15, 2049;

• $482,164,000 of $850 million of 3.35% senior notes due 2027 issued by Medtronic Global Holdings for a total consideration of $1,068.42, with pricing based on a fixed spread of 30 bps over the 2.375% U.S. Treasury due May 15, 2029;

• $965,604,000 of $2.5 billion of 3.15% senior notes due 2022 issued by Medtronic for a total consideration of $1,028.71, with pricing based on a fixed spread of 25 bps over the 1.75% U.S. Treasury due June 15, 2022;

• None of the $650 million of 3.2% senior notes due 2022 issued by Covidien for a total consideration of $1,030.03, with pricing based on a fixed spread of 25 bps over the 1.75% U.S. Treasury due June 15, 2022; and

• None of $309,516,000 of 2.95% senior notes due 2023 issued by Covidien for a total consideration of $1,031.10, with pricing based on a fixed spread of 25 bps over the 2% U.S. Treasury due May 31, 2024.

Because the validly tendered notes of the 4.625% senior notes due 2045, 4.375% senior notes due 2035 and 3.5% senior notes due 2025 exceeded the applicable series tender cap, the maximum tender offer notes are being purchased subject to the acceptance priority levels and subject to proration.

The company is also tendering for any and all of $1,175,000,000 of notes issued in two series by Medtronic.

The company said it had accepted the following notes tendered under the any-and-all offer:

• $250,201,000 of $500 million of 4.125% senior notes due 2021 for a total consideration of $1,034.26, with pricing based on a fixed spread of 15 bps and the 2.375% U.S. Treasury due March 15, 2021; and

• $391,431,000 of $675 million of 3.125% senior notes due 2022 for a total consideration of $1,030.57, with pricing based on a fixed spread of 15 bps and the 2.375% U.S. Treasury due March 15, 2022.

The offer was set to expire at midnight ET on July 24; however because the amount tendered for the maximum tender offer notes exceeded the aggregate maximum purchase price, there is no expectation that any tenders after the early tender deadline will be accepted.

Barclays, BofA Securities Inc. and Goldman Sachs & Co. LLC are acting as the dealer managers for the offers. The information agent and tender agent is Global Bondholder Services Corp.

Medtronic is a medical technology and services company based in Dublin.

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