Verizon sets pricing in private exchange offer for 8.875% notes

By Susanna Moon

Chicago, June 11 – Verizon Communications Inc. said it priced the private offer to exchange Cellco Partnership and Verizon Wireless Capital LLC’s £600 million of outstanding 8.875% notes due Dec. 18, 2018.

Pricing was set on June 11 using the yield of the 5% U.K. Treasury note due March 7, 2018 plus a spread of 40 basis points. The exchange reference security yield was 1.546%, and the exchange offer yield was 1.955%. The cash amount was set at £40.00, and the new notes amount will be £1,255.19.

In exchange, the company is offering Verizon’s new sterling-denominated notes due 2024, with the coupon set at 4.073%, according to a company press release, along with the cash amount.

The coupon on the new notes was set using the sum of the new notes spread of 130 basis points and the yield of the 2.25% U.K. Treasury bond due Sept. 7, 2023 at 7 a.m. ET on June 11.

The yield was 2.732%. The spread was set on June 2.

The total purchase price will be £1,295.19 for each £1,000 principal amount of 8.875% notes tendered by the early tender date.

The total amount includes an early exchange premium of £50.00 principal amount of new notes for each £1,000 principal amount of existing notes tendered by 11:59 p.m. ET on June 11, the early participation date.

Those who tender after the early deadline will receive the exchange price, which is the total exchange price less the early exchange premium.

Verizon will also pay accrued interest.

The Rule 144A and Regulation S exchange offer will end at 11:59 p.m. ET on June 25. The offer began on May 29.

The exchange offer is conditioned on holders tendering at least £300 million principal amount of the 8.875% notes.

Tendered notes may be withdrawn by 11:59 p.m. ET on June 11.

Credit Suisse Securities (Europe) Ltd. (44 20 7883 8763 or liability.management@credit-suisse.com) is the lead dealer manager for the offer, and Banca IMI Securities, BNP Paribas, Loop Capital Markets and Lebenthal Capital Markets are the co-dealer managers. Lucid Issuer Services Ltd. (44 20 7704 0880, attn.: Sunjeeve Patel/Paul Kamminga, verizon@lucid-is.com) is the exchange agent and information agent.

Verizon is a New York City-based telecommunications company.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.