Verizon opens two exchange offers totaling $2.75 billion for 17 series of debt securities

By Wendy Van Sickle

Columbus, Ohio, Sept. 21 – Verizon Communications Inc. announced the beginning of two waterfall exchange offers for 17 outstanding series of debt securities, according to a news release.

The offers will expire at 5 p.m. ET on Oct. 26.

The early participation deadline and withdrawal deadline is 5 p.m. ET on Oct. 2.

The offers consist of a short-dated and a long-dated exchange offer.

For the short-dated exchange offer, the company is offering new notes due Oct. 30, 2030, to be priced based on the 0.625% U.S. Treasury note due Aug. 15, 2030 plus 95 basis points. This offer has a $750 million initial new notes cap and a maximum news notes cap of $2 billion.

For the long-dated exchange offer, the company is offering a combination of cash and new notes due Oct. 30, 2056 to be priced based on the 1.25% U.S. Treasury note due May 15, 2050 plus 145 bps. This offer has a $2 billion initial new notes cap and a maximum new notes cap of $4.5 billion.

The offers are subject to minimum conditions requiring that at least $500 million of new notes must be issued to settle the early exchange of the short-dated notes and at least $1 billion of new notes must be issued to settle the early exchange of the long-dated notes.

There is also a tax condition.

Pricing will be determined at 9 a.m. ET on Oct. 5.

Short-dated offer

The following notes, listed in order of acceptance priority, are covered by the short-dated offer with pricing details given per $1,000 principal amount of existing notes:

• $596,603,000 of 3.45% notes due 2021 (Cusip: 92343VCC6) with pricing to be based on the 0.125% Treasury note due Aug. 31, 2022 plus 5 bps;

• $1,191,927,000 of floating-rate notes due 2022 (Cusip: 92343VDX9) for $1,017 of new notes;

• $3,565,668,000 of 5.15% notes due 2023 (Cusip: 92343VBR4) with pricing to be based on the 0.125% Treasury note due Sept. 15, 2023 plus 30 bps;

• $865,241,000 of 2.946% notes due 2022 (Cusips: 92343VDQ4, 92343VDM3) with pricing to be based on the 0.125% Treasury note due Aug. 31, 2022 plus 5 bps;

• $917,547,000 of 2.45% notes due 2022 (Cusip: 92343VBJ2) with pricing to be based on the 0.125% Treasury note due Aug. 31, 2022 plus 5 bps;

• $669.27 million of 4.15% notes due 2024 (Cusip: 92343VBY9) with pricing to be based on the 0.25% Treasury note due Aug. 31, 2025 plus 25 bps; and

• $1,741,609,000 of 3.5% notes due 2024 (Cusip: 92343VCR3) with pricing to be based on the 0.25% Treasury note due Aug. 31, 2025 plus 25 bps.

In each case, there is a $50 early participation premium.

Accrued interest will be paid in cash.

Long-dated offer

The following notes, listed in order of acceptance priority, are covered by the long-dated offer with pricing details given per $1,000 principal amount of existing notes:

• $1,201,232,000 of 5.5% notes due 2047 (Cusip: 92343VDV3) with pricing to be based on the 1.25% Treasury note due May 15, 2050 plus 126 bps and $63 in cash;

• $951,529,000 of 6.55% notes due 2043 (Cusip: 92343VBT0) with pricing to be based on the 1.25% Treasury note due May 15, 2050 plus 125 bps and $214 in cash;

• $2,821,045,000 of 5.25% notes due 2037 (Cusip: 92343VDU5) with pricing to be based on the 1.25% Treasury note due May 15, 2050 plus 90 bps and $185 in cash;

• $2,523,231,000 of 5.012% notes due 2049 (Cusip: 92343VDS0) with pricing to be based on the 1.25% Treasury note due May 15, 2050 plus 125 bps and $281 in cash;

• $2,040,611,000 of 4.672% notes due 2055 (Cusip: 92343VCZ5) with pricing to be based on the 1.25% Treasury note due May 15, 2050 plus 135 bps and $210 in cash;

• $3,891,529,000 of 4.862% notes due 2046 (Cusip: 92343VCK8) with pricing to be based on the 1.25% Treasury note due May 15, 2050 plus 124 bps and $81 in cash;

• $4,116,902,000 of 4.522% notes due 2048 (Cusip: 92343VCX0) with pricing to be based on the 1.25% Treasury note due May 15, 2050 plus 121 bps and $252 in cash;

• $1,546,295,000 of 4.812% notes due 2039 (Cusip: 92343VDR2) with pricing to be based on the 1.25% Treasury note due May 15, 2050 plus 101 bps and $178 in cash;

• $1,208,915,000 of 5.012% notes due 2054 (Cusip: 92343VCM4) with pricing to be based on the 1.25% Treasury note due May 15, 2050 plus 132 bps and $231 in cash; and

• $1,136,004,000 of 4.125% notes due 2046 (Cusip: 92343VCD5) with pricing to be based on the 1.25% Treasury note due May 15, 2050 plus 120 bps.

Verizon may elect to decrease the principal amount of 2056 new notes exchangeable for each $1,000 principal amount of the applicable long-dated old notes tendered and accepted by up to $100 per $1,000 principal amount, with a corresponding increase or decrease in the applicable cash amount.

In each case, there is a $50 early participation premium.

Accrued interest will be paid in cash.

Global Bondholder Services Corp. will act as the information agent and exchange agent (866 470-3800 or 212 430-3774).

Verizon is a New York-based telecommunications company.

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