Ulster Bank begins tender offer for three series of subordinated bonds

By Mary-Katherine Stinson

Lexington, Ky., Sept. 13 – Ulster Bank Ireland DAC began separate cash tender offers for three series of subordinated bonds, according to a notice.

The bank is offering to purchase any and all of the following:

• £1,148,000 outstanding of the sterling-denominated £5 million floating-rate subordinated bonds (ISIN: IE0004325282) at 112.5;

• €31,154,110.95 outstanding of the Irish pound-denominated £30 million 11.375% subordinated bonds (ISIN: IE0004325399) at 190; and

• £11,453,000 outstanding of the sterling-denominated £20 million 11.75% subordinated bonds (ISIN: IE0004325514) at 175.

Accrued interest will also be paid.

Tender instructions are irrevocable except in limited circumstances.

The offers will expire at 8 a.m. ET on Oct. 23.

Consent bid

In conjunction with the tender offers, the issuer is inviting bondholders to consent to some modifications to the terms and conditions of the bonds. For each series, the proposed changes would provide for the redemption of any bonds that are not purchased under the relevant tender offer at a redemption price equal to the purchase price under the tender offer.

Holders will vote on the proposals at separate meetings for each series.

Each proposal is separate, and its implementation is not conditional upon implementation in any other series, the issuer highlighted.

The bondholder meetings will be held at the Dublin office of A&L Goodbody LLP starting with the meeting for the floating-rate bonds at 5 a.m. ET on Oct. 25, followed immediately by the meeting for the 11 3/8% bonds and then immediately by the meeting for the 11¾% bonds.

Holders participating in a tender offer must also participate in the consent solicitation.

Any bondholder not wishing or able to tender their bonds for purchase but still wishing to vote at the relevant meeting may do so by delivering a duly completed and signed voting only instruction before 8 a.m. ET on Oct. 23.

A quorum of one or more persons present and holding or representing at least one-third of the principal amount is required for the relevant proposal to be considered.

Results will be announced as soon as possible after the meetings.

The bank released two possible timelines, dependent on whether the resolutions are passed at the initial meeting or whether the meetings are adjourned.

If the relevant resolution is passed at the initial meeting, then settlement is expected for Nov. 1.

For any meeting where the relevant proposal is not implemented, the earliest adjourned meeting could be held at 5 a.m. ET on Nov. 8.

The earliest expected settlement date for each series where the proposal was not implemented would be Nov. 15.

NatWest Markets Plc (+44 20 7678 5222, +33 1789 51859, NWMLiabilityManagement@natwestmarkets.com) is the dealer manager for the offers.

The registrar is Computershare Investor Services (Ireland) Ltd. (+353 1447 5468).

The issuer said it is currently in the process of a phased withdrawal from Ireland and, therefore, is seeking to implement the tender offer and the proposals to retire its legacy subordinated liabilities. The bonds are no longer required to meet the bank’s capital requirements and have ceased to be eligible for inclusion in its tier 2 capital and own funds.

The issuer is a Dublin-based bank.

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