Ulster Bank gives results of tender offer for three series of bonds

By Mary-Katherine Stinson

Lexington, Ky., Oct. 25 – Ulster Bank Ireland DAC updated the status of its separate cash tender offers for three series of subordinated bonds, according to multiple notices.

As of the expiration of the offer at 8 a.m. ET on Oct. 23, €24,346,432.49 in principal amount of the 11.375% bonds and £6,486,500 in principal amount of the 11.75% bonds were tendered and accepted for purchase.

The expiration date for the third series, the sterling-denominated floating-rate subordinated bonds, was extended to 8 a.m. ET on Nov. 13.

As previously reported, the bank was 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.

The company also offered to pay accrued interest.

Tender instructions were irrevocable except in limited circumstances.

Consent bid

In conjunction with the tender offers, the issuer was inviting bondholders to consent to some modifications to the terms and conditions of the bonds.

Holders voted on the proposals at separate meetings for each series. Each proposal was separate, and its implementation was not conditional upon implementation in any other series, the issuer highlighted in a previous release.

The bondholder meetings were 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 11.375% bonds and then immediately by the meeting for the 11.75% bonds.

In the case of the 11.375% bonds and the 11.75% bonds, the necessary consents were obtained.

The meeting for the sterling-denominated floating-rate subordinated bonds was adjourned due to a lack of a quorum. A quorum of one or more persons present and holding or representing at least one-third of the principal amount was required for the relevant proposal to be considered.

The notice noted that the tender instructions and voting only instructions received as of the original expiration deadline with regards to the sterling-denominated floating-rate subordinated bonds were all in favor of the resolution.

Holders participating in a tender offer are required to participate in the consent solicitation.

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.

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

Since the relevant resolution was passed at the initial meeting for the 11.375% bonds and the 11.75% bonds, settlement for those series is expected for Nov. 1.

The adjourned meeting for the sterling-denominated floating-rate subordinated bonds has been set at 5 a.m. ET on Nov. 15 with settlement on Nov. 22.

Holders who have already tendered their notes or delivered consents do not need to take any further action.

NatWest Markets Plc (+44 20 7678 5222, +33 1 78 95 18 59, 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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