Verizon announces pricing, acceptance totals in capped tender offers

By Wendy Van Sickle

Columbus, Ohio, Aug. 8 – Verizon Communications Inc. announced acceptance amounts and pricing terms of its cash tender offers to repurchase a capped amount of notes from 14 series, according to a press release on Tuesday.

The company announced the offers on July 25 with an initial cap of $1.5 billion in total cash paid, broken down into two equal parts for the two groups of notes covered by the offers.

Earlier on Tuesday, the company announced it would increase the caps to $1.5 billion total cash paid from $750 million for the group 1 notes and, for group 2 notes, to a total cash amount sufficient to accept all group 2 notes with an acceptance priority of one or two and notes with an acceptance priority of three up to the subcap for that group, which was increased to $450 million from $400 million.

The offers were oversubscribed at the early deadline, and some series will be subject to proration, the company said. Tenders of no notes with acceptance priority of four or higher will be accepted from either group.

The series were divided into two sets, with 10 series comprising the group 1 notes and four series comprising the group 2 notes. Verizon offered to repurchase the notes using a waterfall method.

Group 1 notes

The group 1 notes, listed in order of acceptance priority, and their early tender and acceptance amounts are as follow:

• $358,295,000 tendered and accepted of the $453,209,000 floating-rate notes due 2024 (Cusip: 92343VGD0), for a total consideration of $1,003 per $1,000 principal amount;

• $899,352,000 tendered and accepted of the $1,788,800,000 floating-rate notes due 2025 (Cusip: 92343VEP5), for a total consideration of $1,017 per $1,000 principal amount;

• $506,787,000 tendered and $223,771,000 accepted at a proration factor of 44.2% of the $750 million floating-rate notes due 2026 (Cusip: 92343VGE8), for a total consideration of $1,010 per $1,000 principal amount;

• $15.4 million tendered and none accepted of the $249,838,000 6.94% debentures due 2028 (Cusip: 362320BA0);

• $122,342,000 tendered and none accepted of the $562,561,000 7.75% notes due 2030 (Cusips: 92344GAM8, 92344GAC0);

• $103,895,000 tendered and none accepted of the $354,154,000 6.4% notes due 2033 (Cusip: 92343VBS2);

• $116,545,000 tendered and none accepted of the $420,213,000 5.85% notes due 2035 (Cusip: 92344GAX4);

• $19,564,000 tendered and none accepted of the $101,014,000 7.875% notes due 2032 (Cusip: 92343VEM2);

• $11,741,000 tendered and none accepted of the $106,807,000 7.75% notes due 2032 (Cusip: 92344GAS5); and

• $59,845,000 tendered and none accepted of the $104,993,000 6.8% notes due 2029 (Cusip: 92343VEK6).

Group 2 notes

The group 2 notes, listed in order of acceptance priority, their early tender and acceptance amounts and total considerations per $1,000 principal amount are as follow:

• $21,891,000 tendered and accepted of the $173,192,000 5.05% notes due 2034 (Cusip: 92343VBZ6), with pricing set at $958.43 using the 3.375% Treasury note due May 15, 2033 plus 157 bps;

• $532,523,000 tendered and accepted of the $1,822,407,000 4.272% notes due 2036 (Cusip: 92343VCV4), with pricing set at $890.92 using the 3.375% Treasury note due May 15, 2033 plus 149 bps;

• $1,656,449,000 tendered and $543,402,000 accepted at a proration factor of 32.8% of the $4.25 billion 2.55% notes due 2031 (Cusip: 92343VBGJ7), for $828.12, set using the 3.375% Treasury note due May 15, 2033 plus 132 bps; and

• $1,461,241,000 tendered and none accepted of the $4,199,647,000 4.329% notes due 2028 (Cusip: 92343VER1).

For each series, the total consideration includes an early tender premium of $50 per $1,000 of notes tendered by the early deadline, 5 p.m. ET on Aug. 7.

Tenders could be withdrawn until that time.

The offers are scheduled to expire at 5 p.m. ET on Aug. 22, but the company said it will not accept any additional tenders after the early deadline.

Pricing took place at 9 a.m. ET on Aug. 8.

Settlement is planned for Aug. 9.

Goldman Sachs & Co. LLC (800 828-3182, 212 357-1452), J.P. Morgan Securities LLC (866 834-4666, 212 834-4045), Morgan Stanley & Co. LLC (800 624-1808, 212 761-1057) and SMBC Nikko Securities America, Inc. (888 284-9760, 212 224-5163) are the lead dealer managers for the offers.

CastleOak Securities, LP, Loop Capital Markets LLC, Samuel A. Ramirez & Co., Inc. and Siebert Williams Shank & Co., LLC are co-dealer managers.

Global Bondholders Services Corp. (855 654-3774 or 212 430-3774) is the information agent for the offers.

Verizon is a New York City-based telecommunications company.

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