BHP Billiton buys back $923.53 million of two series in capped tender

By Susanna Moon

Chicago, Sept. 11 – BHP Billiton Ltd.’s wholly owned subsidiary, BHP Billiton Finance (USA) Ltd., announced the results of the capped tender for three series of dollar-denominated notes.

The company was offering to spend up to $1 billion excluding accrued interest in the tender that began Aug. 22.

BHP will accept the following amount of notes with the total purchase price for each $1,000 principal amount set at 11 a.m. ET on Sept. 8 using the reference yield of the bid-side yield of the 1.875% U.S. Treasury note due July 31, 2022 plus a fixed spread, listed in order of priority acceptance levels:

• $765,587,000 of the $1.5 billion 3.85% senior notes due 2023 with pricing at $1,092.33 based on a reference yield of 1.661%;

• $157,945,000, using a pro ration factor of 38.0799%, of the $859,938,000 2.875% senior notes due 2022 with pricing at $1,036.60 based on a reference yield of 1.661%; and

• None of the $529,978,000 3.25% senior notes due 2021 with pricing at $1,057.82 based on a reference yield of 1.661%.

The spread was 55 basis points for the 3.85% notes, 35 bps for the 2.875% notes and 15 bps for the 3.85% notes.

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

Holders also will receive accrued interest up to but excluding the settlement date.

The tender offers had been set to remain open until 11:59 p.m. ET on Sept. 21. However, because the offers have been oversubscribed, no more notes are expected to be purchased in the offer.

As announced Aug. 22, BHP was offering to buy back the notes under a $2.5 billion global multi-currency bond repurchase plan for bonds issued under BHP's U.S. debt capital markets program and under the euro medium-term notes program.

The multi-currency plan will be funded by BHP's $14.2 billion cash position and the early repurchase of bonds will extend the company's average debt maturity profile and enhance the group's capital structure, the company previously said.

The company also held a separate and concurrent tender for its six series of notes that ended at 11 a.m. ET on Aug. 30.

The tender was capped at $2,941,124,380.13, increased from $2.5 billion, less the aggregate purchase price excluding accrued interest of the euro notes tendered and accepted for purchase in the euro tender offers.

BHP said on Sept. 8 that holders had tendered $1,253,824,000 of the three series of notes as of 5 p.m. ET on Sept. 7, the early tender date.

Specifically, holders had tendered $72,183,000 of the company’s $529,978,000 3.25% senior notes due 2021; $416,054,000 of the $859,938,000 2.875% senior notes due 2022; and $765,587,000 of the $1.5 billion 3.85% senior notes due 2023, according to a company update on Friday.

Settlement is expected to occur on Sept. 12.

The global coordinators and lead dealer managers are Deutsche Bank Securities (212 250-2955 or 866 627-0391) and UBS Investment Bank (203 719-4210, 888 719-4210, +44 20 7568 2133 or ol-liabilitymanagement-eu@ubs.com). The lead dealer managers are J.P. Morgan (212 834-8553, 866 834-4666 or JPM_LM@jpmorgan.com) and MUFG (212 405-7481, 877 744-4532, +44 20 7577 4048/4218 or DCM-LM@int.sc.mufg.jp). The co-dealer managers are BBVA, Mizuho Securities and SMBC Nikko.

The tender and information agent is Global Bondholders Services Corp. (212 430-3774, 866 470-3800, fax 212 430-3775 or 212 430-3779).

Euro offers

In the euro offers, BHP Billiton Finance Ltd. was offering to repurchase its €1.25 billion 2.125% notes due November 2018, €600 million floating-rate notes due April 2020, €1.25 billion 2.25% notes due September 2020, €650 million 0.75% notes due October 2022, €750 million 3% notes due May 2024 and £750 million 3.25% notes due September 2024.

The company said on Aug. 31 that it would pay $1,941,124,380 to purchase the tendered notes.

BHP accepted the following amount of notes in the euro offer with pricing set at 6 a.m. ET on Aug. 31:

• None of the 2018 notes, pricing was to be set using a tender offer yield of negative 20 bps for a tender offer price of €1,028.73 per €1,000 using a settlement date of Sept. 5, but none of these notes will be purchased in the offer;

• €338.38 million, equivalent to $404,213,554.74, of the April 2020 notes with a tender offer price of 100.9% and €261,620,000 outstanding after the offer;

• €413,228,000, equivalent to $525,148,992.21, of the September 2020 notes, pricing set at 107.344% using the September 2020 interpolated mid-swap rate minus 7 bps for a reference benchmark rate of negative 0.077% and a tender offer yield of negative 0.147%, and €836,772,000 outstanding after the offer;

• €273,787,000, equivalent to $333,591,488.94, of the 2022 notes, pricing set at 102.917% using the 2022 interpolated mid-swap rate plus 0 bps for a reference benchmark rate of and tender offer yield of 0.18%, and €376,213,000 outstanding after the offer;

• €189,866,000, equivalent to $262,669,423.74, of the 2024 euro notes, pricing set at 116.855% using the 2024 interpolated mid-swap rate plus 6 bps for a reference benchmark rate of 0.391% and a tender offer yield of 0.451%, and €560,134,000 outstanding after the offer; and

• £286,957,000, equivalent to $415,500,920.50, of the 2024 pound notes, pricing set 112.620% using the U.K. Treasury rate plus 68 bps for a reference benchmark rate of 0.677% and a tender offer yield of 1.362%, and £463,043,000 outstanding after the offer.

Settlement was expected to occur on Sept. 5.

The global coordinators and lead dealer managers are Deutsche Bank AG, London Branch (+44 20 7545 8011 and UBS Ltd. (+44 20 7568 2133 or ol-liabilitymanagement-eu@ubs.com). The lead dealer managers are Banco Santander, SA (+44 20 7756 6909 / 6646, tommaso.grospietro@santandergcb.com / King.Cheung@santandergcb.com) and Societe Generale (+33 142 13 32 40 or liability.management@sgcib.com). The co-dealer managers are Lloyds Bank plc, Royal Bank of Scotland plc (trading as NatWest Markets) and UniCredit Bank AG.

The tender and information agent is Lucid Issuer Services Ltd. (+44 20 7704 0880, fax +44 20 3004 1590 or bhp@lucid-is.com).

BHP Billiton is a diversified natural resources company based in Melbourne, Australia.

© 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.