Wal-Mart gives early count in capped tender for dollar, sterling notes

By Susanna Moon

Chicago, June 29 – Wal-Mart Stores, Inc. gave an early tender update in its capped offers for four series of dollar notes and three series of sterling securities.

As of 5 p.m. ET on June 28, the early tender date, investors had tendered $1,238,099,000, or 41.27%, of the company’s 6.5% notes due Aug. 15, 2037 and $852,232,000, or 42.61%, of its 6.2% notes due April 15, 2038.

Holders also had tendered £418,842,000, or 41.88%, of the 4.875% notes Jan. 19, 2039.

Wal-Mart said that both parts of the tender are oversubscribed.

As a result, the company will buy all the 6.5% notes tendered by the early deadline and some of the 6.2% notes on a pro rata basis. No other dollar notes will be accepted.

Similarly, the 4.875% sterling notes will be accepted on a pro rata basis and no other sterling notes will be purchased.

As announced on June 15, Wal-Mart is tendering for up to $2 billion purchase price of dollar notes and up to £500 million purchase price of sterling securities.

In the dollar offers, pricing will be set using a reference security plus a fixed spread for a hypothetical total purchase price for each $1,000 principal amount as follows, with the notes listed in order of priority acceptance levels:

• $3 billion of 6.5% notes due Aug. 15, 2037 with pricing based on the 3% U.S. Treasury due Feb. 15, 2047 plus 75 basis points for a hypothetical total purchase price of $1,420.14;

• $2 billion of 6.2% notes due April 15, 2038 with pricing based on the 3% U.S. Treasury due Feb. 15, 2047 plus 75 bps for a hypothetical total purchase price of $1,385.78;

• $1.25 billion of 5.625% notes due April 1, 2040 with pricing based on the 3% U.S. Treasury due Feb. 15, 2047 plus 80 bps for a hypothetical total purchase price of $1,311.21; and

• $2 billion of 5.625% notes due April 15, 2041 with pricing based on the 3% U.S. Treasury due Feb. 15, 2047 plus 80 bps for a hypothetical total purchase price of $1,320.26.

For the sterling notes, the hypothetical total purchase price for each £1,000 principal amount is as follows, with pricing to be set using a reference security plus a fixed spread and the notes listed in order of priority acceptance levels:

• £1 billion of 4.875% notes due Jan. 19, 2039 with pricing based on the 4.25% U.K. Treasury due 2039 plus 60 bps for a hypothetical total purchase price of £1,441.58;

• £1 billion of 5.25% notes due Sept. 28, 2035 with pricing based on the 4.5% U.K. Treasury due 2034 plus 60 bps for a hypothetical total purchase price of £1,474.02; and

• £500 million of 5.75% notes due Dec. 19, 2030 with pricing based on the 4.75% U.K. Treasury due 2030 plus 65 bps for a hypothetical total purchase price of £1,456.02.

The total purchase price will include an early tender premium of $30.00 or £30.00 for each respective $1,000 or £1,000 principal amount of notes tendered by the early tender deadline.

Holders also will receive accrued interest.

Pricing was scheduled for 10 a.m. ET on June 29.

The hypothetical pricing was set using the reference yield at 10 a.m. ET on June 14.

The tender offers will remain open until 11:59 p.m. ET on July 13. Tendered notes may be withdrawn before the early deadline.

Securities tendered before the early participation date will be given priority over those tendered afterward, regardless of the priority level.

Settlement will occur on July 6 for early tendered notes and on July 17 for any remaining tenders.

Barclays (212 528-7581, 800 438-3242, +44 20 3134-8515 or liability.management@barclays.com), J.P. Morgan Securities LLC (212 834-4811, 866 834-4666 or +44 20 7134-2468) and Mizuho Securities USA LLC (212 205-7736, 866 271-7403, +44 20 7090-6929) are the joint lead dealer managers. Credit Suisse Securities (USA) LLC, BNP Paribas Securities Corp. and Citigroup Global Markets Inc. are the senior co-dealer-managers. Santander Investment Securities Inc., BBVA Securities Inc. and RBS Securities Inc. are the co-dealer managers.

Global Bondholder Services Corp. (212 430-3774, 866 924-2200, 212 430-3774, contact@gbsc-usa.com or gbsc-usa.com/Wal-Mart/) is the information agent.

The discount retailer is based in Bentonville, Ark.

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