Co-operative Group tenders for £250 million of 5 5/8% notes due 2020

By Susanna Moon

Chicago, Nov. 9 – Co-operative Group Ltd. is offering to purchase up to £250 million of its £450 million 5 5/8% notes due 2020 until noon ET on Nov. 15.

The tender offer price will be 107.25% plus accrued interest.

The notes currently pay interest at the step-up amount of 6 7/8% and are guaranteed by Funeral Services Ltd., Co-operative Group Holdings (2011) Ltd., Co-operative Group Food Ltd., Co-operative Foodstores Ltd. and Rochpion Properties (4) LLP.

The tender is being held “to provide liquidity to noteholders and proactively manage the Co-op Group's balance sheet,” according to a company announcement.

Co-operative plans to price new sterling-denominated fixed-rate notes with a roadshow expected to begin Nov. 12.

The tender is contingent on pricing and subscription agreement for the new issue.

Barclays Bank plc, ING Bank NV, London Branch and Lloyds Bank Corporate Markets plc are the joint lead managers.

Noteholders who subscribe for new notes in addition to tendering in the offer may receive priority in the allocation of the new issue, the company said.

Settlement is expected to occur on Nov. 23.

The dealer managers are Barclays Bank plc (+44 20 3134 8515 pr eu.lm@barclays.com), ING Bank NV, London Branch (+31 20 563 8017 or liability.management@ing.com) and Lloyds Bank Corporate Markets plc (+44 20 7158 1721 / 1726 or liability.management@lloydsbanking.com).

The tender agent is Lucid Issuer Services Ltd. (+44 20 7704 0880 or co-op@lucid-is.com).

Co-operative Group is a Manchester, England-based consumer cooperative with a range of retail businesses.

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