Pentair says tender oversubscribed by early deadline, sets pricing

New York, May 25 – Pentair plc said that its tender offer to pay up to $1.75 billion to buy notes from eight series was oversubscribed by the early deadline.

As a result, notes with priority level six will be accepted on a pro rata basis and notes will not be accepted from priority levels seven and eight.

In addition, no further tenders will be accepted.

The company also announced pricing for the offer and the amount of each series to be purchased.

The tender began on May 11 and the early deadline was 5 p.m. ET on May 24, according to a news release.

Holders had tendered notes as follows by the early deadline, with results listed in descending order of priority of acceptance:

• $304,761,000 of Pentair Finance SA’s $373,026,000 of 5% senior notes due 2021. The purchase price is $1,095.93 per $1,000 principal amount, calculated using a spread of 50 basis points over the 1.875% Treasury due April 30, 2022;

• $91,482,000 of Pentair Inc.’s $126,974,000 of 5% senior notes due 2021. The purchase price is $1,095.93 per $1,000 principal amount, calculated using a spread of 50 bps over the 1.875% Treasury due April 30, 2022;

• $230.67 million of Pentair Finance SA’s $250 million of 4.65% senior notes due 2025. The purchase price is $1,090.20 per $1,000 principal amount, calculated using a spread of 110 bps over the 2.25% Treasury due Feb. 15, 2027;

• $326,019,000 of Pentair Finance SA’s $400 million of 3.625% senior notes due 2020. The purchase price is $1,048.53 per $1,000 principal amount, calculated using a spread of 60 bps over the 1.5% Treasury due May 15, 2020;

• $461,743,000 of Pentair Finance SA’s $550 million of 3.15% senior notes due 2022. The purchase price is $1,026.12 per $1,000 principal amount, calculated using a spread of 80 bps over the 1.875% Treasury due April 30, 2022;

• $480,443,000 of Pentair Finance SA’s $500 million of 2.9% senior notes due 2018. The purchase price is $1,016.45 per $1,000 principal amount, calculated using a spread of 40 bps over the 1% Treasury due Sept. 15, 2018. Of the amount tendered, $244,698,000 will be accepted;

• $238,207,000 of Pentair Finance SA’s $250 million of 2.65% senior notes due 2019. Pricing was to be based on a spread of 60 bps over the 1.25% Treasury due April 30, 2019 but was not announced since no notes will be accepted for purchase; and

• $265,839,000 of Pentair Finance SA’s $350 million of 1.875% senior notes due 2017. Pricing was to be based on a spread of 20 bps over the 1% Treasury due Sept. 15, 2017 but was not announced since no notes will be accepted for purchase.

Pricing was scheduled for 2 p.m. ET on May 25.

All the prices include a $30.00 per $1,000 early tender premium that will only be paid to those who tendered by the early deadline.

Pentair will also pay accrued interest up to but excluding the settlement date.

The tender ends at midnight ET on June 8.

The $1.75 billion that Pentair is offering to pay in the offer does not include the accrued interest.

Alongside the tender, Pentair is soliciting consents to amend the note indentures to modify or eliminate substantially all of the restrictive covenants, certain events of default and related provisions.

Holders who tendered were required to deliver consents.

Based on the early tender results, Pentair plans to execute a supplemental indenture for both series of 5% notes due 2021, the 4.65% notes due 2025, the 3.625% notes due 2020 and the 3.15% notes due 2022.

The supplemental indenture will become operative when Pentair buys the notes.

Early settlement is planned for May 26.

Citigroup Global Markets Inc. (800 558-3745 or 212 723-6106) is lead dealer manager and lead solicitation agent.

Global Bondholder Services Corp. (866 470-3800 or 212 430-3774) is information agent.

Pentair is a Minneapolis-based company mostly providing equipment related to water.

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