Dr. Pepper counts early tenders in oversubscribed offer; pricing set

By Susanna Moon

Chicago, June 5 – Dr. Pepper Snapple Group Inc. said investors had tendered $156,911,000 of its 7.45% notes due 2038 and $62,698,000 of its 6.82% notes due 2018 as of 5 p.m. ET on June 2, the early tender date.

Dr. Pepper Snapple then amended the tender offers and raised the maximum purchase price to $250 million from $180 million, according to a company update on Monday.

The company said it plans to accept for purchase the tendered 7.45% notes using a proration rate of about 79.7% and all of the tendered 6.82% notes due 2018.

The tenders will remain open until 11:59 p.m. ET on June 16. Tendered notes may not be withdrawn after the early deadline.

The company said on May 19 that it was offering to spend up to $180 million for its $250 million of outstanding 7.45% notes and $364,128,000 of outstanding 6.82% notes.

Pricing was set at 2 p.m. ET on June 5 using a reference security plus a fixed spread for a purchase price per $1,000 principal amount as follows, with the notes listed in order of priority acceptance level:

• $1,461.25 for the 7.45% notes due 2038 with a tender cap of $125 million, using the 3% Treasury note due Feb. 15, 2047 plus a fixed spread of 130 basis points; and

• $1,044.27 for the 6.82% notes, using the 0.75% Treasury note due April 30, 2018 plus 45 bps.

The total purchase price includes an early tender premium of $30.00 per $1,000 principal amount of notes tendered by the early tender deadline.

Holders will also receive accrued interest to but excluding the settlement date of June 19.

The purchase price will be determined using the fixed spread for each series of notes over the reference yield based on the bid-side price of the U.S. Treasury security.

The offers contain a financing condition.

Morgan Stanley & Co. LLC (800 624-1808) is the dealer manager. Requests for the offer may be directed to D.F. King & Co. (212 269-5550 or 877 536-1556).

Dr. Pepper Snapple is a maker of non-alcoholic beverages and is based in Plano, Texas.

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