Lafarge targets €1.25 billion of notes in tender for nine series

New York, May 19 – Lafarge SA said it is aiming to buy back €1.25 billion of notes in a tender offer for nine series of its debt securities.

The company is offering to buy three series of notes in an any-and-all offer and a further six in a capped offer.

If any notes are accepted for purchase, then all validly tendered notes in the any-and-all offer will be accepted.

The company will then accept notes from the capped offer up to a total principal amount of €1.25 billion, although Lafarge said this limit may be increased or decreased.

The any-and-all offer is for the following notes:

• The €750 million of 4.75% notes due September 2020 with pricing to be set using a spread of 35 basis points over mid-swaps;

• The €500 million of 4.75% notes due March 2020 with pricing to be set using a spread of 30 bps over mid-swaps; and

• The €559,525,000 of 5.5% notes due December 2019 with pricing to be set using a spread of 25 bps over mid-swaps.

The capped offer is for the following notes:

• The €255,943,000 of 5.875% notes due July 2019 with pricing to be set using a fixed purchase yield of 10 bps;

• The €532,257,000 of 5.375% notes due November 2018 with pricing to be set using a fixed purchase yield of zero;

• The €328,142,000 of 5% notes due April 2018 with pricing to be set using a fixed purchase yield of zero;

• The €324.45 million of 5.375% notes due June 2017 with pricing to be set using a fixed purchase yield of zero;

• The £72,746,000 of 6.625% notes due November 2017 with pricing to be set using a spread of 90 bps over the 1% Gilt due September 2017; and

• The £95,725,000 of 10% notes due May 2017 with pricing to be set using a spread of 80 bps over the 1.75% Gilt due January 2017.

The coupon on the May 2017 sterling notes stepped up by 125 bps following downgrades in 2011 by Moody’s Investors Service and S&P. Upgrades by both rating agencies last year mean the coupon will step down by 125 bps at the next interest payment date. The tender purchase price will reflect this step down.

Funding for the tender will come from an offering of new notes by Holcim Finance (Luxembourg) SA, a financing subsidiary for LaFargeHolcim.

By carrying out the transactions, the company intends to extend the average maturity of its debt and improve its cost of financing by taking advantage of “currently favorable market conditions,” according to a notice from the issuer.

The tender ends at 11 a.m. ET on May 26.

Pricing will be set at 7 a.m. ET on May 27. In addition to the prices calculated using the formulas above, holders will receive accrued interest up to but excluding the settlement date, which is expected to be May 31.

Goldman Sachs International (+44 20 7774 9862 or liabilitymanagement.eu@gs.com), HSBC Bank plc (+44 20 7992 6237 or liability.management@hsbcib.com), Societe Generale (+33 1 42 13 40 66 or liability.management@sgcib.com) are structuring advisers and dealer managers with Citigroup Global Markets Ltd. (+44 20 7986 8969 or liabilitymanagement.europe@citi.com), J.P. Morgan Securities plc (+44 20 7134 2468 or emea_lm@jpmorgan.com) and Royal Bank of Scotland plc (+44 20 7085 3781 or liabililtymanagement@rbs.com) as dealer managers.

Citibank, NA, London Branch (+44 20 7508 3867 or exchange.gats@citi.com) is the tender agent.

LafargeHolcim is a Jona, Switzerland, supplier of cement, aggregates and concrete.

© 2015 Prospect News.
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