CenturyLink begins offers for $800 million of Embarq, CenturyTel notes

By Angela McDaniels

Tacoma, Wash., Sept. 14 - CenturyLink, Inc. and its wholly owned subsidiary, Embarq Corp., have begun a joint tender offer under which they will purchase up to $600 million of notes, and CenturyLink will purchase up to $200 million of notes in a second offer.

The companies will purchase up to $600 million principal amount of Embarq's $1 billion of 6.738% notes due June 1, 2013 and the $250 million of 5.5% senior notes due April 1, 2013, series O, issued by CenturyTel, Inc.

The notes are listed in order of priority acceptance, according to a CenturyLink news release.

For each $1,000 principal amount, the purchase price is $1,092.50 for the 6.738% notes and $1,052.50 for the 5.5% notes.

In addition, CenturyLink will purchase up to $200 million principal amount of CenturyTel's $500 million of 7.875% senior notes due Aug. 15, 2012, series L, and its $500 million of 8.375% senior notes due Oct. 15, 2010, series H.

These notes are also listed in order of priority acceptance.

For each $1,000 principal amount, the purchase price is $1,117.50 for the 7.875% notes and $1,065.00 for the 8.375% notes.

Each of the purchase prices listed above includes a $30.00 payment for notes tendered by 5 p.m. ET on Sept. 25, the early tender date. The purchase price for notes tendered after that time but before midnight ET on Oct. 9, the expiration date, will receive the specified purchase price minus $30.00.

Holders will receive accrued interest for all notes accepted.

In each offer, if the principal amount of notes tendered exceeds the cap, the notes will be purchased in the order of their priority acceptance levels.

If there are enough funds to purchase only a portion of the notes of a series, the amount of notes purchased in that series will be prorated.

The offers are not subject to the receipt of any minimum amount of notes. They are conditioned on, among other things, the successful completion of the offering by CenturyLink of $600 million of fixed-rate senior notes with 10-year and 30-year maturities.

Bank of America Merrill Lynch, Barclays Capital Inc., J.P. Morgan Securities Inc. and Wells Fargo Securities, LLC are the lead dealer managers for the offers.

Global Bondholder Services Corp. (866 470-3900 or 212 430-3774) is the information agent.

Embarq and CenturyTel merged in July to form CenturyLink, a Monroe, La.-based provider of voice, broadband and video services.

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