AIG announces tender results and upsizes offer to $7.06 billion

By Mary-Katherine Stinson

Lexington, Ky., April 7 – American International Group, Inc. announced the results in the offers to purchase for cash 23 separate notes and said it amended the offers to increase the maximum purchase amount to $7.06 billion from $6 billion., according to a press release on Thursday.

Overall, $10,947,117,379.60 equivalent principal amount of the notes were tendered prior to the expiration date.

In addition, $76,357,000.00 were tendered pursuant to guaranteed delivery procedures.

As previously reported, the 23 series each have an acceptance priority order but will not be prorated. All of the notes were issued by AIG, with the exception of the fifth series which was issued by Validus Holdings, Ltd.

The tender results for each series of notes, listed by acceptance priority order each with considerations payable per $1,000, €1,000 or £1,000 principal amount, are as follows:

• £41.35 million of the £42 million outstanding 5.75% series A-2 junior subordinated debentures due March 15, 2037 (Cusip: 026874BF3) with a first par call date of March 15, 2017 at the fixed redemption amount of £1,000 were tendered and accepted for purchase;

• €49.85 million of the €91 million outstanding 4.875% series A-3 junior subordinated debentures due March 15, 2037 (Cusip: 026874BG1) with a first par call date of March 15, 2017 at the fixed redemption amount of €972.50 were tendered and accepted for purchase;

• $31,882,000 of the $198 million outstanding 8.175% series A-6 junior subordinated debentures due May 15, 2058 (Cusip: 026874BS5) with a first par call date of May 15, 2038 at the fixed redemption amount of $1,397.50 were tendered and accepted for purchase;

• $25,903,000 of the $64 million outstanding 6.25% series A-1 junior subordinated debentures due March 15, 2037 (Cusip: 026874BE6) at the fixed redemption amount of $1,070 were tendered and accepted for purchase with $135,000 being tendered pursuant to the guaranteed delivery procedures;

• $14,475,000 of the $214 million outstanding 8.875% senior notes due 2040 issued by Validus due Jan. 26, 2040 (Cusip: 91915WAB8) with pricing based on the 2.375% U.S. Treasury due Feb. 15, 2042 plus 175 basis points resulted in a total consideration of $1,519.63 based on a Treasury yield of 2.825% were tendered and accepted for purchase with $2,000 being tendered pursuant to the guaranteed delivery procedures;

• £188.6 million of the £500 million outstanding 5% notes due April 26, 2023 (ISIN: XS0252367775) with pricing based on the 0.125% U.K. Treasury due Jan. 31, 2023 plus 75 bps resulted in a total consideration of £1,030.37 based on a Treasury yield of 1.293% were tendered and accepted for purchase;

• $277,322,000 of the $500 million outstanding 4.7% notes due July 10, 2035 (Cusip: 026874DE4) with a first par call date of Jan. 10, 2035 and with pricing based on the 1.875% U.S. Treasury due Feb. 15, 2032 plus 135 bps resulted in a total consideration of $1,073.08 based on a Treasury yield of 2.614% were tendered and accepted for purchase;

• $727,914,000 of the $1.25 billion outstanding 3.75% notes due July 10, 2025 (Cusip: 026874DD6) with a first par call date of April 10, 2025 and with pricing based on the 1.75% U.S. Treasury due March 15, 2025 plus 45 bps resulted in a total consideration of $1,016.53 based on a Treasury yield of 2.719% were tendered and accepted for purchase with $1,797,000 being tendered pursuant to the guaranteed delivery procedures;

• $1,502,399,000 of the $2.25 billion outstanding 4.5% notes due July 16, 2044 (Cusip: 026874DA2) with a first par call date on Jan. 16, 2044 and with pricing based on the 2.375% U.S. Treasury due Feb. 15, 2042 plus 120 bps resulted in a total consideration of $1,068.40 based on a Treasury yield of 2.825% were tendered and accepted for purchase with $7,082,000 being tendered pursuant to the guaranteed delivery procedures;

• $1,259,794,000 of the $1.6 billion outstanding 3.4% notes due June 30, 2030 (Cusip: 026874DR5) with a first par call date of March 30, 2030 and with pricing based on the 1.875% U.S. Treasury due Feb. 15, 2032 plus 90 bps resulted in a total consideration of $991.88 based on a Treasury yield of 2.614% were tendered and accepted for purchase with $5,188,000 being tendered pursuant to the guaranteed delivery procedures;

• $553,583,000 of the $800 million outstanding 4.375% notes due Jan. 15, 2055 (Cusip: 026874DB0) with a first par call date of July 15, 2054 and with pricing based on the 1.875% U.S. Treasury due Nov. 15, 2051 plus 135 bps resulted in a total consideration of $1,065.13 based on a Treasury yield of 2.663% were tendered and accepted for purchase with $6,122,000 being tendered pursuant to the guaranteed delivery procedures;

• $540,415,000 of the $1 billion outstanding 4.125% notes due Feb. 15, 2024 (Cusip: 026874CY1) with pricing based on the 2.75% U.S. Treasury due Feb. 15, 2024 plus 25 bps resulted in a total consideration of $1,024.10 based on a Treasury yield of 2.53% were tendered and accepted for purchase with $1,155,000 being tendered pursuant to the guaranteed delivery procedures;

• $691,015,000 of the $1.2 billion outstanding 3.875% notes due Jan. 15, 2035 (Cusip: 026874DC8) with a first par call date of July 15, 2034 and with pricing based on the 1.875% U.S. Treasury due Feb. 15, 2032 plus 130 bps resulted in a total consideration of $996.06 based on a Treasury yield of 2.614% were tendered and accepted for purchase with $379,000 being tendered pursuant to the guaranteed delivery procedures;

• $408,812,000 of the $750 million outstanding 4.2% notes April 1, 2028 (Cusip: 026874DK0) with a first par call date of Jan. 1, 2028 and with pricing based on the 1.875% U.S. Treasury due Feb. 28, 2027 plus 70 bps resulted in a total consideration of $1,039.20 based on a Treasury yield of 2.741% were tendered and accepted for purchase with $1,298,000 being tendered pursuant to the guaranteed delivery procedures;

• $733,098,000 of the $1 billion outstanding 4.375% notes due June 30, 2050 (Cusip: 026874DP9) with a first par call date of Dec. 30, 2049 and with pricing based on the 1.875% U.S. Treasury due Nov. 15, 2051 plus 120 bps resulted in a total consideration of $1,086.61 based on a Treasury yield of 2.663% and $35,211,000 pursuant to the guaranteed delivery procedures were tendered but were not accepted for purchase and will be returned to the tendering noteholders;

• $408,183,000 of the $600 million outstanding 4.25% notes due March 15, 2029 (Cusip: 026874DN4) with a first par call date of Dec. 15, 2028 and with pricing based on the 1.875% U.S. Treasury due Feb. 15, 2032 plus 90 bps resulted in a total consideration of $1,043.53 based on a Treasury yield of 2.614% were tendered and accepted for purchase with $412,000 being tendered pursuant to the guaranteed delivery procedures;

• $154,715,000 of the $584 million outstanding 6.25% notes due May 1, 2036 (Cusip: 026874AZ0) with pricing based on the 1.875% U.S. Treasury due Feb. 15, 2032 plus 150 bps resulted in a total consideration of $1,226.34 based on a Treasury yield of 2.614% and $100,000 pursuant to the guaranteed delivery procedures were tendered but were not accepted for purchase and will be returned to the tendering noteholders;

• $64,529,000 of the $143 million outstanding 6.82% notes due Nov. 15, 2037 (Cusip: 026874CW5) with pricing based on the 1.875% U.S. Treasury due Feb. 15, 2032 plus 155 bps resulted in a total consideration of $1,302.48 based on a Treasury yield of 2.614% were tendered but were not accepted for purchase and will be returned to the tendering noteholders;

• $450,923,000 of the $750 million outstanding 4.8% notes due July 10, 2045 (Cusip: 026874DF1) with a first par call date of Jan. 10, 2045 and with pricing based on the 2.375% U.S. Treasury due Feb. 15, 2042 plus 120 bps resulted in a total consideration of $1,114.74 based on a Treasury yield of 2.825% with $600,000 pursuant to guaranteed delivery procedures were tendered but were not accepted for purchase and will be returned to the tendering noteholders;

• $709,813,000 of the $1 billion outstanding 4.75% notes due April 1, 2048 (Cusip: 026874DL8) with a first par call date of Oct. 1, 2047 and with pricing based on the 1.875% U.S. Treasury due Nov. 15, 2051 plus 125 bps resulted in a total consideration of $1,134.21 based on a Treasury yield of 2.663% with $11,973,000 pursuant to guaranteed delivery procedures were tendered but were not accepted for purchase and will be returned to the tendering noteholders;

• $729,179,000 of the $1.5 billion outstanding 3.9% notes due April 1, 2026 (Cusip: 026874DH7) with a first par call date of Jan. 1, 2026 and with pricing based on the 1.875% U.S. Treasury due Feb. 28, 2027 plus 55 bps resulted in a total consideration of $1,021.25 based on a Treasury yield of 2.741% with $1.9 million pursuant to guaranteed delivery procedures were tendered but were not accepted for purchase and will be returned to the tendering noteholders;

• $1,168,818,000 of the $1.5 billion outstanding 2.5% notes due June 30, 2025 (Cusip: 026874DQ7) with a first par call date of May 30, 2025 and with pricing based on 1.75% U.S. Treasury due March 15, 2025 plus 45 bps resulted in a total consideration of $979.60 based on a Treasury yield of 2.719% with $3,003,000 pursuant to guaranteed delivery procedures were tendered but were not accepted for purchase and will be returned to the tendering noteholders; and

• €127,489,000 of the €1 billion outstanding 1.875% notes due June 21, 2027 (ISIN: XS1627602201) with a first par call date of March 21, 2027 priced at the fixed redemption amount of €1,002.50 were tendered but were not accepted for purchase and will be returned to the tendering noteholders.

As previously reported, the total consideration does not include the accrued coupon payment, which will be paid in cash in addition to the total consideration.

Exchange rates for the sterling and euro notes were $1.3081 per £1.00 and $1.0914 per €1.00 respectively.

Based on the exchange rates, AIG is accepting a total of $6,796,900,885 combined principal amount of notes, excluding notes tendered via guaranteed delivery procedures.

The offers expired at 5 p.m. ET on April 6, also the withdrawal deadline.

Notes tendered via guaranteed delivery procedures are due by 5 p.m. ET on April 8.

Initial settlement will be April 8. Notes tendered via guaranteed delivery will be settled on April 12.

As previously reported, the offers are conditioned on the repayment of at least $5.5 billion from a promissory note previously issued by Corebridge Financial, Inc. to AIG.

BNP Paribas Securities Corp. (888 210-4358, 212 841-3059), Deutsche Bank Securities Inc. (866 627-0391, 212 250-2955), Deutsche Bank AG, London Branch (+44 20 7545 8011), Goldman Sachs & Co. LLC (800 828-3182, 212 357-1452), U.S. Bancorp Investments, Inc. (877 558-2607, 612 336-7604) and Wells Fargo Securities, LLC (866 309-6316, 704 410-4756) are the lead dealer managers for the offer.

Ipreo LLC (888 593-9546, 212 849-3880, ipreo-tenderoffer@ihsmarkit.com) is the tender and information agent.

AIG is a New York-based insurance provider.

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