VTB accepts tenders for $291 million of three note series; pricing set

By Susanna Moon

Chicago, Jan. 27 - VTB Capital plc said investors had tendered about $643 million of notes issued by VTB Capital SA for the purpose of financing loans to JSC VTB Bank.

The company began a modified Dutch auction tender offer for up to $500 million of notes on Jan. 21. The offer ended at 11 a.m. ET on Jan. 24, with settlement set for Jan. 30.

VTB plans to accept for purchase an aggregate principal amount of about $291 million across all series of notes, with no proration, according to a company press release.

As previously announced, the company tendered for the $750 million of 6.315% loan participation notes due Feb. 22, 2018; the $1,700,548,000 of outstanding $2 billion 6.875% loan participation notes due May 29, 2018; and the $1 billion of 6.551% loan participation notes due Oct. 13, 2020.

The company will purchase $52,135,000 of 6.315% notes, $186,862,000 of 6.875% notes and $51,989,000 of 6.551% notes.

Pricing details

The total purchase price per $1,000 principal amount will be $1,082.68 for the 6.315% notes, $1,101.51 for the 6.875% notes and $1,075.65 for the 6.551% notes, according to a separate press release later on Monday.

Pricing was set at 9 a.m. ET on Jan. 27 using the interpolated mid-swap rate plus a purchase spread as follows:

• Interpolated mid-swap rate February 2018 plus 277 basis points for the 6.315% notes;

• Interpolated mid-swap rate May 2018 plus 286 bps for the 6.875% notes; and

• Interpolated mid-swap rate 2020 plus 299 bps for the 6.551% notes.

The benchmark rate was 1.314% for the 6.315% notes, 1.42% for the 6.875% notes and 2.208% for the 6.551% notes. The purchase yield was 4.084% for the 6.315% notes, 4.28% for the 6.875% notes and 5.198% for the 6.551% notes.

The purchase price was set to equal the value of all remaining payments of principal and interest for the notes up to and including the maturity date for the notes, discounted to the settlement date at a rate equal to the relevant purchase yield minus accrued interest.

The purpose of the offers was to enable VTB to acquire some of its outstanding eurobonds at their current market prices, which reflects VTB's robust liquidity position and is consistent with its ongoing liability management objectives, according to a previous press release.

The offers will also provide an opportunity to noteholders to gain liquidity for their notes, the company added at the time.

VTB said it will continue to consider opportunities to repurchase its long-term as well as short-term debt.

The dealer managers are Citigroup Global Markets Ltd. (44 20 7986 8969, attn: liability management group, email liabilitymanagement.europe@citi.com) and VTB Capital plc (44 203 334 8029, attn: global head of syndicate, email vtb.dcm@vtbcapital.com). The tender agent is Lucid Issuer Services Ltd. (44 0 20 7067 9098, email vtb@lucid-is.com, attn: David Shilson).

VTB is a Moscow-based lender.

© 2015 Prospect News.
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