Prologis sets pricing for maximum tender offer for two notes series

By Toni Weeks

San Luis Obispo, Calif., Nov. 7 - Prologis, Inc. said it has determined the total consideration regarding two series of notes issued by its operating subsidiary, Prologis LP.

The subsidiary is conducting a maximum tender offer for its $588,555,000 of 6.625% notes due May 15, 2018 issued by Prologis and $14.42 million of 6.625% notes due May 15, 2018 issued by its wholly owned subsidiary trust.

Pricing for the maximum tender offer was set at 2 p.m. ET on Nov. 7 using the bid-side yield of a reference security plus a fixed spread.

For either series, the price is equal to 75 basis points over the 1.277% yield based on the 1.375% Treasury note due Sept. 30, 2018, for a total tender offer consideration of $1,195.98 per $1,000 principal amount.

The total purchase price for the maximum offer includes an early tender premium of $30.00 per $1,000 principal amount of notes tendered by the early tender date, 5 p.m. ET on Nov. 6. Holders who tender after the early deadline will receive $1,165.98 per $1,000 principal amount.

Holders also will receive accrued interest up to but excluding the settlement date, which will be promptly after the offer ends.

The company announced on Wednesday that it had received tenders for about $324.2 million total of "maximum tender notes" by the early deadline. It took in tenders for $321,188,000 of the notes issued by Prologis and $3,031,000 of the notes issued by the trust.

The company is offering to purchase the maximum principal amount of notes that it can purchase including accrued interest for up to any difference between $350 million and the total payment, including accrued interest, for the notes purchased in its recently completed any and all tender offer, which expired Oct. 31. The company took in tenders for about $262 million principal amount of four note series in the any and all offer.

Because the total purchase amount for the any and all offer was about $305 million, the maximum tender amount will be capped at about $45 million, according to a previous press release.

Prologis said it will prorate acceptance of the tendered notes in the maximum offer, as the amount of notes tendered exceeds the cap.

Tendered notes may no longer be withdrawn.

The maximum tender offer will end at 11:59 p.m. ET on Nov. 21.

The dealer managers are Goldman Sachs & Co. (800 828-3182 or 212 357-6436 collect) and Morgan Stanley & Co. LLC (800 624-1808 or 212 761-0858 collect). The information agent is Global Bondholder Services Corp. (866 470-4300 or 212 430-3774 collect).

San Francisco-based Prologis is an owner, operator and developer of industrial real estate in global and regional markets.

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