Kellogg announces early tender results for notes from five series

By Rebecca Melvin

New York, Aug. 7 – Kellogg Co. announced early tender results of its offers to purchase for cash any and all of its 4.15% senior notes due 2019 and some of the notes from four series, for which the sublimits have been adjusted, according to a company news release.

The sublimit for Kellogg’s 4% senior notes due 2020 was increased to up to $248,053,000 aggregate principal amount, the sublimit for the 3.25% senior notes due 2021 was increased to up to $201,947,000, and the sublimits for the 2.65% senior notes due 2023 and the 3.4% senior notes due 2027 were increased to up to $75 million each.

Holders who tendered their notes at or prior to 5 p.m. ET on Aug. 6, the early tender date, are eligible to receive the total consideration, including an early tender premium of $30 per $1,000 principal amount of notes.

The notes tendered so far are:

• $190,937,000 principal amount of 4.15% senior notes due 2019, which is the principal amount to be accepted, with pricing based on 15 basis points over the 3.375% U.S. Treasury due Nov. 15, 2019;

• $296,264,000 principal amount tendered of 4% senior notes due 2020, compared to a maximum amount to be accepted of $248,053,000, with pricing based on a fixed spread of 35 bps over the 1.625% U.S. Treasury due June 30, 2021;

• $201,947,000 principal amount tendered of the 3.25% senior notes due 2021, which matches the maximum amount to be accepted, with pricing based on a fixed spread of 25 bps over the 1.625% U.S. Treasury due June 30, 2021;

• $300 million principal amount tendered of 2.65% senior notes due 2023, compared to $50 million amount to be accepted, with pricing based on the 1.75% U.S. Treasury due June 30, 2024 and a fixed spread of 45 bps; and

• $75 million principal amount tendered of 3.4% senior notes due 2027, compared to $64,751,000 to be accepted, with pricing based on the 2.375% U.S. Treasury due May 15, 2029 and a fixed spread of 95 bps.

The offers will expire at 11:59 p.m. ET on Aug. 20.

As previously reported, the company will also pay accrued and unpaid interest from and including the last interest payment date up to but excluding the applicable settlement date, which is expected to be Aug. 9 for early tenders and Aug. 22 for any final tenders.

All notes tendered under the maximum tender offer on or before the early tender date having a higher acceptance priority level will be accepted before any tendered notes having a lower acceptance priority level are accepted in the offers; and all notes tendered under the maximum tender offer after the early tender date having a higher acceptance priority level will be accepted before any notes tendered under the maximum tender offer after the early tender date having a lower acceptance priority level are accepted in the offers.

Notes under the maximum offer are subject to proration.

The tender offers are conditioned on completion of Ferrero International SA’s acquisition of certain of Kellogg’s businesses.

BofA Securities Inc. (980 387-3907 or 888 292-0070), Citigroup Global Markets Inc. (212 723-6106 or 800 558-3745) and J.P. Morgan Securities LLC (212 834-8553 or 866 834-4666) are acting as lead dealer managers for the offers.

The information and tender agent is D.F. King & Co., Inc. (800 499-8159 or 212 269-5550 or e-mail kelloggs@dfking.com).

Kellogg is a food manufacturing company based in Battle Creek, Mich.

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