AT&T to issue new notes due 2042, 2045 in exchange for 17 note series

By Susanna Moon

Chicago, Nov. 16 - AT&T Inc. said it began private offers to exchange 17 series of notes issued by BellSouth Corp., BellSouth Telecommunications, LLC and AT&T for a new series of AT&T's senior notes due in 2042 or 2045 and cash.

Holders also will receive accrued interest to but excluding the exchange date.

The company will issue up to $3.5 billion of new notes due 2042 and up to $3.5 billion of new notes due 2045, but the combined maximum amount of new notes will be $4 billion, according to a press release.

In addition, the maximum principal amount of pool 1 notes accepted for tender is $400 million, and the maximum amount of pool 2 notes accepted for tender is $800 million. The pool 1 offer and the pool 2 offer will each be conducted under a modified Dutch auction.

The purchase price also will include an early participation amount for notes tendered by 5 p.m. ET on Nov. 29.

The exchange offers will expire at 11:59 p.m. ET on Dec. 13. Tendered notes may be withdrawn by the early participation deadline.

The 7.12% debentures due 2097 and the 7.875% notes were originally issued by BellSouth Capital Funding Corp., which subsequently merged with and into BellSouth Corp.

The 8% notes due 2031 were issued by AT&T Corp. and are guaranteed by AT&T. The 8.75% notes due 2031 were issued by New Cingular Wireless Services, Inc., formerly known as AT&T Wireless Services, Inc. And the 7.125% senior notes due 2031 were issued by AT&T Mobility LLC, which was formerly known as Cingular Wireless LLC.

The exchange offers will only be made to holders who are qualified institutional buyers under Rule 144A or those who are not U.S. persons under Regulation S.

Each offer is conditioned on the issuer of at least $500 million principal amount of the new 2042 notes and at least $500 million principal amount of new 2045 notes.

D.F. King & Co., Inc. (800 488-8095, collect 212 269-5550 or via email at ATT@dfking.com) is the information agent.

The telecommunications company is based in Dallas.

Pool 1 offer

Notes Issuer Exchange payment

7.12% debentures due 2097 BellSouth New 2042 notes and cash

7% notes due 2095 BellSouth Telecommunications New 2042 notes and cash

6.65% zero-to-full debentures due 2095 BellSouth Telecommunications New 2042 notes and cash

Pool 2 offer for BellSouth notes

Notes Exchange payment

7.875% notes due 2030 New 2045 notes and cash

6.875% notes due 2031 New 2045 notes and cash

6.55% notes due 2034 New 2045 notes and cash

6% notes due 2034 New 2045 notes and cash

AT&T notes

Notes listed in order of priority acceptance Exchange payment

6.45% global notes due 2034 New 2045 notes

6.15% global notes due 2034 New 2045 notes

8% notes due 2031 New 2042 notes

8.75% notes due 2031 New 2042 notes

7.125% senior notes due 2031 New 2042 notes

6.8% notes due 2036 New 2045 notes and cash

6.4% global notes due 2038 New 2045 notes and cash

6.5% global notes due 2037 New 2042 notes and cash

6.3% global notes due 2038 New 2042 notes and cash

6.55% global notes due 2039 New 2045 notes and cash

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