Albemarle holders tender €533.33 million 1.875% notes in capped offer

By Susanna Moon

Chicago, Jan. 19 – Albemarle Corp. said investors had tendered €533.33 million of its 1.875% senior notes due 2021 as of 5 p.m. ET on Jan. 18, the early tender date.

As announced Jan. 4, the company was tendering for any and all of two series of notes until 5 p.m. ET on Jan. 10 and up to a maximum repurchase amount of two other note series equal to $500 million less the amount of 2020 notes purchased in the any-and-all offer.

Based on the results of the any-and-all offer, the company is tendering for up to $325,215,000 of notes in the capped offer.

Because the amount of 2021 notes tendered in the offer exceeds the maximum repurchase amount, none of the tendered 2024 notes will be accepted for purchase, according to a company update on Thursday.

The breakdown for the early tendered notes is as follows, with the notes listed in order of priority acceptance levels:

• €533.33 million, or 76.19%, of €700 million 1.875% senior notes due 2021 with pricing scheduled for 10 a.m. ET on Jan. 19 using the interpolated mid-swap rate plus 35 bps; and

• $229,435,000, or 53.98%, of the $425 million 4.15% senior notes due 2024 with pricing based on the 2% U.S. Treasury note due Nov. 15, 2026 plus 85 bps.

The total purchase price in the capped offers will include an early tender premium of €30.00 per €1,000 of 1.875% notes and $30.00 per $1,000 of 4.15% notes tendered by the early deadline.

The maximum tender offers are set to end at 11:59 p.m. ET on Feb. 1.

Tendered notes may no longer be withdrawn as of the early deadline.

Notes tendered by the early deadline will be given priority over notes tendered afterward, the company previously said.

The company also said it may increase or decrease the maximum repurchase amount.

Holders will also receive accrued interest up to but excluding the payment date of Jan. 20 for early tendered notes and Feb. 2 for any remaining tenders.

Albemarle will fund the tender with proceeds from the sale of its Chemetall Surface Treatment segment.

The tender offers are being made to reduce the company’s outstanding debt, according to a previous company announcement.

BofA Merrill Lynch (888 292-0070, 980 387-3907 or +44 20 7996 5420) is the dealer manager. D.F. King & Co., Inc. (800 967-4617, 212 269-5550, 888 542-7446, +44 20 7920 9700, dfking.com/alb) is the tender and information agent.

Any-and-all offer

In the any-and-all offer, investors had tendered $366,837,000 of the two series of notes, or $192,052,000 of the $250 million 3% senior notes due 2019 and $174,785,000 of the $350 million 4.5% senior notes due 2020.

The amounts exclude $135,000 of 3% notes and $406,000 of 4.5% notes tendered under guaranteed delivery procedures.

The purchase price for each $1,000 principal amount is $1,036.47 for the 3% notes and $1,082.65 for the 4.5% notes.

Pricing was set for the 3% notes using the 1.5% U.S. Treasury note due Oct. 31, 2019 plus 25 basis points and, for the 4.5% notes, the 1.375% U.S. Treasury note due Aug. 31, 2020 plus 50 bps.

Holders will also receive accrued interest up to but excluding the payment date of Jan. 11 or Jan. 13 in the case of the notes tendered under the guaranteed delivery procedures.

The any-and-all offers ended at 5 p.m. ET on Jan. 10.

On Jan. 11, Albemarle called its 3% senior notes due 2019 for redemption on Feb. 10.

The notes will be redeemed at a price equal to the greater of par and the sum of the present values of the remaining scheduled payments of principal and interest excluding interest accrued to the redemption date from the redemption date through the par call date, in each case discounted to the redemption date on a semiannual basis at the Treasury rate plus 25 bps plus accrued interest to but excluding the redemption date, according to the company notice.

The redemption will be funded using proceeds from the company's sale of its Chemetall Surface Treatment segment.

Albemarle is a Baton Rouge, La., specialty chemicals company.

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