AIG extends consent solicitation for SunAmerica notes and tender offer

Chicago, June 9 – American International Group, Inc. (AIG) announced that it is extending the tender offers and consent solicitations for notes originally issued by SunAmerica Inc., according to a press release.

The company is also extending the tender offer expiration time.

The consent solicitation extension represents just part of the original offer started on May 11, which also included notes originally issued by American General Corp.

For American General notes, the current obligor is AIG Life Holdings, Inc. For SunAmerica notes, the current obligor is AIG.

Consent solicitations

For all series of notes (listed below) except for the 7.5% notes due 2025, the 6.625% notes due 2029 and the 8.5% junior subordinated debentures due 2030 originally issued by American General, AIG was soliciting consents. Sufficient consents have now been received for the series A and the series B notes.

The company is further extending the deadline to 11:59 p.m. ET on June 15 for the SunAmerica notes. The consent solicitation time had been extended for the series A notes and the SunAmerica notes until 11:59 p.m. ET on June 8.

As of the extended deadline, sufficient consents were received for the series A notes, as well.

AIG announced that it had received sufficient consents as of the early deadline for the series B notes of AIG Life Holdings.

The background of the consent solicitations and the tender offers is that the notes were issued by legacy life and retirement companies prior to these companies being acquired by AIG in the late 1990s and early 2000s. As a result of these acquisitions, this debt was either assumed (in the case of the SunAmerica notes) or guaranteed (in the case of the notes originally issued by American General Corp.) by AIG.

As AIG pursues a separation of its life and retirement business, the tender offers and consent solicitations are intended to retire some or all of this legacy debt and conform the covenants governing any such debt not tendered so they are in line with covenants governing other existing AIG-issued debt.

AIG needs holders representing a majority of the notes of each series to effect the proposed amendments.

A consent payment of $5 will be paid to noteholders who submit stand-alone consents without tendering their notes.

Otherwise, the $5 consent will be part of the $30 early tender payment. Tendering noteholders must also consent.

Tender recap

AIG also announced on Wednesday that it will be extending the original expiration time for the tender offers and the payment of the total consideration to any tenders for notes received to 11:59 p.m. ET on June 15.

As of the early deadline, AIG had received tenders for the following amounts of notes, announced on May 25:

• $5,280,000, or 14.37%, of the $36,745,000 outstanding of 7.57% junior subordinated deferrable interest debentures, series A, (Cusip: 00138GAB5) issued by American General priced using the 1.875% U.S. Treasury due Feb. 15, 2051 plus 175 basis points for a total consideration of $1,540.72;

• $70,002,000, or 33.02%, of the $211,987,000 outstanding of 8.125% junior subordinated deferrable interest debentures, series B, (Cusip: 00138GAC3) issued by American General priced using the 1.875% U.S. Treasury due Feb. 15, 2051 plus 175 bps for a total consideration of $1,630.56;

• $34,066,000, or 25.14%, of the $135,531,000 outstanding of 7.5% notes due 2025 issued by American General (Cusip: 026351AU0) priced using the 0.75% U.S. Treasury due April 30, 2026 plus 45 bps for a total consideration of $1,250.83;

• $47,788,000, or 32.49%, of the $147,091,000 outstanding of 6.625% notes due 2029 issued by American General (Cusip: 026351AZ9) to priced using the 1.25% U.S. Treasury due Feb. 15, 2031 plus 65 bps for a total consideration of $1,308.06;

• $59,244,000, or 51.92%, of the $114.11 million outstanding of 8.5% junior subordinated debentures due 2030 (Cusip: 00138GAA7) issued by American General priced using the 1.125% U.S. Treasury due Feb. 15, 2031 plus 150 bps for a total consideration of $1,424.77;

• $17,782,000, or 20.59%, of the $86,367,000 outstanding of 8.125% debentures due April 28, 2023 (Cusip: 866930AB6) issued by SunAmerica priced using the 0.125% U.S. Treasury due April 30, 2023 plus 0 bps for a total consideration of $1,152.95;

• $1,107,000, or 8.12%, of the $13.64 million of 7.05% notes due 2025 issued by SunAmerica (Cusip: 86703QBJ9) priced using the 0.75% U.S. Treasury due April 30, 2026 plus 40 bps for a total consideration of $1,255.44;

• $498,000, or 5.66%, of the $8,797,000 outstanding of 7% notes due 2026 issued by SunAmerica (Cusip: 86703QBN0) priced using the 0.75% U.S. Treasury due April 30, 2026 plus 45 bps for a total consideration of $1,262.08 (originally published as $1,262,03 by AIG); and

• $17,829,000, or 89.16%, of the $19,996,000 outstanding of 5.6% debentures due 2097 issued by SunAmerica (Cusip: 866930AG5) priced using the 1.875% U.S. Treasury due Feb. 15, 2051 plus 170 bps for a total consideration of $1,375.60.

The total considerations include an early tender payment of $30 per $1,000 principal amount. The early tender payment of $30 includes a $5 consent fee for the series that involve consents, as described below.

AIG had previously extended the early tender total consideration until 11:59 p.m. ET on June 8.

Noteholders who tendered by the early deadline were paid on May 26, the early settlement date.

Interest will also be paid to the settlement date.

Details

The early tender deadline was 5 p.m. ET on May 24, also the consent expiration time.

Pricing was set at 2 p.m. ET on May 24.

Credit Suisse Securities (USA) LLC (800 820-1653, 212 538-2147) and J.P. Morgan (866 834-4666, 212 834-4045) are the dealer managers and consent solicitation agents.

D.F. King, & Co. Inc. is the tender and information agent (800 334-0384, 212 269-5550, aig@dfking.com).

AIG is a New York-based insurance provider.

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