Italy’s 2i Rete Gas begins tender for 1.125% notes, some 1.75% notes

By Susanna Moon

Chicago, Feb. 14 – 2i Rete Gas SpA began another round of tender offers for its €524,999,000 of outstanding €750 million 1.75% notes due July 16, 2019 and its €540 million 1.125% notes due Jan. 2, 2020.

This time, 2i Rete is tendering for any and all of its 2020 notes and up to an amount of the 2019 notes equal to €400 million principal amount less the principal amount of 2020 notes accepted for purchase, according to the company announcement.

Tender instructions must be received by 11 a.m. ET on Feb. 20.

Pricing will be set on Feb. 21 using a purchase yield of 0% for the 2020 notes and negative 0.05% for the 2019 notes.

The purchase price will be 103.199% of par for the 2020 notes and 104.284% for the 2019 notes, assuming a settlement date of Feb. 28.

Holders also will receive accrued interest.

The company said its reserves the right to increase or decrease the offer cap.

The offers are part of the issuer’s “medium-term financial strategy aimed at proactively managing its liabilities and cost of debt financing,” the release noted.

The company plans to cancel the notes acquired in the offers.

The issuer plans to price a series of new euro-denominated senior fixed-rate notes under its €3.5 billion euro medium-term notes program.

The offer is contingent on the signing of a subscription agreement for the new notes on Feb. 24.

The dealer managers are Banca IMI SpA (+39 02 7261 5938 or Liability.Management@bancaimi.com), BNP Paribas (+44 20 7595 8668 or liability.management@bnpparibas.com), Mediobanca - Banca di Credito Finanziario SpA (+39 02 8829 840 or MB_LM_CORP_IT@mediobanca.com), UniCredit Bank AG (+49 89 3781 3722 or corporate.lm@unicredit.de), Merrill Lynch International (+44 20 7996 5420 or DG.LM_EMEA@baml.com) and Societe Generale (+44 20 7676 7680 or liability.management@sgcib.com).

The tender agent is Lucid Issuer Services Ltd. (+44 20 7704 0880 or 2iretegas@lucid-is.com).

As announced Jan. 18, investors had tendered €348,887,000 of the 1.75% notes in the capped offer for the two series of notes that began Jan. 10.

The purchase price was set at 104.329 using a purchase yield of 0% with accrued interest of 0.921%.

The company was tendering for up to €225 million of the two series of notes, but because the offer was oversubscribed, none of the tendered 1.125% notes were accepted for purchase.

2i Rete distributes natural gas in Italy and is based in Milan.

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