FirstEnergy announces early results, upsizes tender offer to $1.1 billion

Chicago, June 14 – FirstEnergy Corp. announced the early results of its tender offer and its decision to upsize the tender offer to $1.1 billion from $800 million in two press releases on Tuesday.

The company was offering to buy a capped amount of its $1.5 billion outstanding 7 3/8% notes, series C, due 2031 (Cusip: 337932AC1) and its $1 billion outstanding 4.85% notes, series C, due 2047 (Cusip: 337932AJ6).

Currently, the 2047 notes have a 5.35% interest rate, as noted previously.

Noteholders tendered $715,225,000 of the 7 3/8% notes and $430,146,000 of the 4.85% notes by the early deadline.

The company is accepting all of the 7 3/8% tendered notes and $283,525,000, or 65.9%, of the 4.85% notes.

The total consideration for the 7 3/8% notes is $1,168.23 and the total consideration for the 4.85% notes is $932.73.

Pricing was calculated for the 2031 notes using a calculation with the 2.875% U.S. Treasury due May 15, 2032 plus 175 basis points (decreased earlier from 235 bps).

Pricing for the 2047 notes was determined using the 2.25% U.S. Treasury due Feb. 15, 2052 plus 250 bps (decreased earlier from 300 bps).

The total considerations include a $50 early tender premium for noteholders who tendered by the early deadline

Interest will also be paid to the settlement date.

The early tender deadline was 5 p.m. ET on June 13 (extended from 5 p.m. ET on June 8).

The withdrawal deadline was at 5 p.m. ET on June 8.

As of the withdrawal deadline, noteholders tendered $48,018,000 of the 2031 notes and $37,742,000 of the 2047 notes.

The dealer managers calculated pricing at 10 a.m. ET on June 14 (shifted from 10 a.m. ET on June 9).

Early settlement will be June 15 (pushed back from June 10).

The tender offer will expire at 11:59 p.m. ET on June 28 (from 11:59 p.m. ET on June 23).

The company said that it will not purchase any notes tendered after the early deadline, though.

Any final settlement would have been June 30 (from June 27).

There were financing conditions which have been satisfied.

The tender offer was conditioned upon the sale of a minority interest in FirstEnergy Transmission, LLC to Brookfield Infrastructure Partners. This was completed on May 31.

Barclays (800 438-3242, 212 528-7581) and Morgan Stanley & Co. LLC (800 624-1808, 212 761-1057) are the dealer managers.

D.F. King & Co., Inc. is the information and tender agent for the offer (800 859-8509, 212 269-5550, fe@dfking.com).

The diversified energy holding company is based in Akron, Ohio.

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