Verizon takes in tenders for $2.12 billion of 29 series, sets pricing

By Susanna Moon

Chicago, Aug. 15 – Verizon Communications Inc. set pricing in the 29 separate cash tender offers for its notes and notes of several of its subsidiaries.

Investors had tendered $2,123,559,303.81 of the notes as of 5 p.m. ET on Aug. 11 and Verizon increased the waterfall cap to the amount tendered so far and accepted those notes for purchase, according to a company update.

Verizon had begun tendering for $1.5 billion of the notes on July 31, and the offers had been set to run until 11:59 p.m. ET on Aug. 25; however, because the waterfall cap has been met by the early deadline, no more tendered notes will be accepted for purchase.

The withdrawal rights expired at 5 p.m. ET on Aug. 11.

The early tender results are as follows, with the total purchase for each $1,000 principal amount set using a fixed spread over the bid-side price of the reference U.S. Treasury security at 11 a.m. ET on Aug. 14 as follows, with the notes listed in order of priority acceptance levels from 1 to 29:

• $3,128,000, or 2.79%, of Verizon Communications Inc.’s $111.99 million 8.95% notes due 2039 with pricing at $1,581.16 using the 3% Treasury notes due Feb. 15, 2047 plus 185 basis points for an offer yield of 4.65%;

• $5,166,000, or 3.26%, of Verizon Communications Inc.’s $158,613,000 7.35% notes due 2039 with pricing at $1,365.68 using the 3% Treasury notes due Feb. 15, 2047 plus 185 bps for an offer yield of 4.65%;

• $11,616,000, or 7.06%, of Verizon Maryland LLC’s $164,527,000 5.125% debentures due 2033 with pricing at $1,070.16 based on 3% Treasury notes due Feb. 15, 2047 plus 170 bps for an offer yield of 4.5%;

• $13,456,000, or 6.11%, of Verizon Communications Inc.’s $220,311,000 6.9% notes due 2038 with pricing at $1,312.55 using the 3% Treasury notes due Feb. 15, 2047 plus 175 bps for an offer yield of 4.55%;

• $33.88 million, or 8.52%, of Verizon Communications Inc.’s $397,434,000 6.4% notes due 2038 with pricing at $1,244.91 using the 3% Treasury notes due Feb. 15, 2047 plus 175 bps for an offer yield of 4.55%;

• $49,212,000, or 26.19%, of Alltel Corp.’s $187,889,000 6.8% debentures due 2033 with pricing at $1,237.19 based on the 2.375% Treasury notes due May 15, 2027 plus 200 bps for an offer yield of 4.212%;

• $34,123,000, or 10.05%, of Verizon Communications Inc.’s $339,432,000 6.25% notes due 2037 with pricing at $1,226.44 using the 3% Treasury notes due Feb. 15, 2047 plus 170 bps for an offer yield of 4.5%;

• $41,119,000, or 13.97%, of Verizon Communications Inc.’s $294,386,000 6% notes due 2041 with pricing at $1,192.25 using the 3% Treasury notes due Feb. 15, 2047 plus 185 bps for an offer yield of 4.65%;

• $3,446,000, or 1.68%, of Verizon New York Inc.’s $205,025,000 7.375% debentures due 2032 with pricing at $1,336.14 based on the 2.375% Treasury notes due May 15, 2027 plus 205 bps for an offer yield of 4.262%;

• $47,952,000, or 8.71%, of Verizon Communications Inc.’s $550,404,000 5.85% notes due 2035 with pricing at $1,186.41 using the 3% Treasury notes due Feb. 15, 2047 plus 155 bps for an offer yield of 4.35%;

• $1,365,000, or 0.93%, of Verizon New England Inc.’s $147,062,000 7.875% debentures due 2029 with pricing at $1,347.59 based on the 2.375% Treasury notes due May 15, 2027 plus 200 bps for an offer yield of 4.212%;

• $26,344,000, or 5.60%, of Verizon Communications Inc.’s $470,844,000 6.4% notes due 2033 with pricing at $1,255.29 using the 3% Treasury notes due Feb. 15, 2047 plus 140 bps for an offer yield of 4.2%;

• $19,368,000, or 10.83%, of Verizon Communications Inc.’s $178,882,000 7.75% notes due 2032 with pricing at $1,407.75 using the 2.375% Treasury notes due May 15, 2027 plus 185 bps for an offer yield of 4.062%;

• $273,376,000, or 19.27%, of Verizon Communications Inc.’s $1,418,865,000 6.55% notes due 2043 with pricing at $1,294.40 using the 3% Treasury notes due Feb. 15, 2047 plus 180 bps for an offer yield of 4.6%;

• $987,105,000, or 78.97%, of Verizon Communications Inc.’s $1.25 billion 5.05% notes due 2034 with pricing at $1,093.51 using the 3% Treasury notes due Feb. 15, 2047 plus 145 bps for an offer yield of 4.25%;

• $163,270,000, or 48.44%, of Alltel Corp.’s $337,049,000 7.875% senior notes due 2032 with pricing at $1,415.55 based on the 2.375% Treasury notes due May 15, 2027 plus 190 bps for an offer yield of 4.112%;

• $19,676,000, or 3.38%, of Verizon Communications Inc.’s $582,856,000 7.75% notes due 2030 with pricing at $1,394.77 based on the 2.375% Treasury notes due May 15, 2027 plus 170 bps for an offer yield of 3.912%;

• $12,608,000, or 3.84%, of GTE LLC’s $327,917,000 6.94% debentures due 2028 with pricing at $1,282.07 based on the 2.375% Treasury notes due May 15, 2027 plus 150 bps for an offer yield of 3.712%;

• $9,862,000, or 8.13%, of Verizon New Jersey Inc.’s $121,254,000 8% debentures due 2022 with pricing at $1,233.47 based on the 1.875% Treasury notes due July 31, 2022 plus 100 bps for an offer yield of 2.763%;

• $28,219,000, or 35.47%, of Verizon New Jersey Inc.’s $79,554,000 7.875% debentures due 2029 with pricing at $1,345.22 based on the 2.375% Treasury notes due May 15, 2027 plus 200 bps for an offer yield of 4.212%;

• $1,108,000, or 1.57%, of Verizon New York Inc.’s $70,512,000 6.5% debentures due 2028 with pricing at $1,209.23 based on the 2.375% Treasury notes due May 15, 2027 plus 185 bps for an offer yield of 4.062%;

• $1,463,000, or 2.55%, of Verizon Pennsylvania LLC’s $57,338,000 6% debentures due 2029 with pricing at $1,164.18 based on the 2.375% Treasury notes due May 15, 2027 plus 195 bps for an offer yield of 4.162%;

• $401,000, or 0.71%, of Verizon Virginia LLC’s $56.41 million 7.875% debentures due 2022 with pricing at $1,213.33 based on the 1.875% Treasury notes due July 31, 2022 plus 95 bps for an offer yield of 2.713%;

• $117,000, or 0.32%, of Verizon Pennsylvania LLC’s $36,126,000 8.75% debentures due 2031 with pricing at $1,462.76 based on the 2.375% Treasury notes due May 15, 2027 plus 210 bps for an offer yield of 4.312%;

• $483,000, or 1.52%, of Verizon Pennsylvania LLC’s $31,826,000 8.35% debentures due 2030 with pricing at $1,418.72 based on the 2.375% Treasury notes due May 15, 2027 plus 200 bps for an offer yield of 4.212%;

• $361,000, or 1.30%, of Verizon Maryland LLC’s $27,719,000 8% debentures due 2029 with pricing at $1,357.59 based on the 2.375% Treasury notes due May 15, 2027 plus 200 bps for an offer yield of 4.212%;

• $430,000, or 1.98%, of Verizon Maryland LLC’s $27,744,000 8.3% debentures due 2031 with pricing at $1,414.96 based on the 2.375% Treasury notes due May 15, 2027 plus 210 bps for an offer yield of 4.312%;

• $186,000, or 2.02%, of Verizon Virginia LLC’s $9,217,000 8.375% debentures due 2029 with pricing at $1,392.04 based on the 2.375% Treasury notes due May 15, 2027 plus 200 bps for an offer yield of 4.212%; and

• None of Verizon Delaware LLC’s $2,381,000 8.625% debentures due 2031.

In each case, the total amount includes a $50 early premium per $1,000 of notes tendered by the early deadline of 5 p.m. ET on Aug. 11.

Holders will also receive accrued interest to the settlement date.

Tendered notes may be withdrawn by the early deadline.

Verizon used a waterfall methodology to accept the notes for purchase in the order of their listed acceptance priority levels.

The tender offers were contingent on Verizon pricing debt securities with proceeds of at least $3 billion by the early deadline.

Goldman Sachs & Co. LLC (800 828-3182 or 212 902-6595, JPMorgan (866 834-4666 or 212 834-4811), Mizuho Securities at (866 271-7403 or 212 205-7736) and Wells Fargo Securities at (866 309-6316 or 704 410-4760) are the lead dealer managers. Loop Capital Markets LLC, Santander Investment Securities Inc., CastleOak Securities, LP and Williams Capital Group, LP are the co-dealer managers.

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

Verizon is a New York City-based telecommunications company.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.