Tesco tenders for eight series of euro-, sterling-denominated notes

By Wendy Van Sickle

Columbus, Ohio, Jan. 19 – Tesco plc and Tesco Corporate Treasury Services plc announced cash tender offers for eight series of notes, according to a news release on Tuesday.

The notes include

• €600 million 5.125% notes due 2047 (ISIN: XS0295018070) with pricing to be based on mid-swaps plus 215 basis points;

• €750 million 2.5% notes due 2024 issued by Tesco Corporate Treasury and guaranteed by Tesco plc (ISIN: XS1082971588) with pricing to be based on mid-swaps plus 30 bps;

• £900 million of 6.125% notes due 2022 (ISIN: XS0414345974) with pricing to be based on Treasuries plus 25 bps;

• £515 million 5% notes due 2023 (ISIN: XS0248392812) with pricing to be based on Treasuries plus 40 bps;

• £200 million 6% notes due 2029 (ISIN: XS0105244585) with pricing to be based on Treasuries plus 135 bps;

• £200 million 5.5% notes due 2033 (ISIN: XS0159013142) with pricing to be based on Treasuries plus 150 bps;

• £300 million 4.875% notes due 2042 (ISIN: XS0248395245) with pricing to be based on Treasuries plus 175 bps; and

• £500 million 5.2% notes due 2057 (ISIN: XS0289810318) with pricing to be based on Treasuries plus 190 bps.

Holders will also receive accrued interest.

Except the €750 million 2.5% notes due 2024, all other series are issued by Tesco plc.

The €600 million 5.125% notes due 2047 have acceptance priority, and all the other series rank equally.

The cap under the euro and pounds sterling offers will be set such that the total amount payable for the tendered notes will be no greater than total proceeds received by Tesco Corporate for a planned issue of new notes, less the euro equivalent of the total amount payable by Tesco for all notes tendered under a concurrent tender for U.S.-dollar notes.

Tesco said Tesco Corporate is planning to issue a new series of euro-denominated fixed rate notes to be guaranteed by Tesco.

Tesco said the tenders are being made to strengthen its balance sheet by addressing upcoming debt maturities and achieving net annual interest savings.

The offers will expire at 11 a.m. ET on Jan. 27 and will be priced at 8 a.m. ET on Jan. 28.

Settlement is expected on Jan. 29.

BNP Paribas (+33 1 55 77 78 9 or liability.management@bnpparibas.com), Citigroup Global Markets Ltd. (+44 20 7986 8969 or liabilitymanagement.europe@citi.com), MUFG Securities EMEA plc (+44 20 20 7577 4218 or liability.management@mufgsecurities.com) and RBC Europe Ltd. (+44 20 7029 7063 or liability.management@rbccm.com) are acting as dealer managers.

Lucid Issuer Services Ltd. (+44 20 7704 0880 or tesco@lucid-is.com) is acting as information and tender agent.

Tesco is a Cheshunt, England-based grocery and retail chain.

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