Verizon gives tender tally for 29 series, lifts cap to $2.1 billion

By Susanna Moon

Chicago, Aug. 14 – Verizon Communications Inc. announced the early tender results of 29 separate cash tender offers for its notes and notes of several of its subsidiaries as of 5 p.m. ET on Aug. 11.

Verizon lifted the waterfall cap, or the total cash payment, to about $2.1 billion from $1.5 billion after satisfying the financing condition, according to a company update on Monday.

The offers began July 31 and had been set to run until 11:59 p.m. ET on Aug. 25; however, because the waterfall cap has been met by the early deadline, no more tendered notes will be accepted for purchase.

The withdrawal rights expired at 5 p.m. ET on Aug. 11.

The early tender results are as follows, with the notes listed in order of priority acceptance levels from 1 to 29, and the total purchase for each $1,000 principal amount will be set using a fixed spread over the bid-side price of the reference U.S. Treasury security at 11 a.m. ET on Aug. 14 as follows:

• $3,128,000, or 2.79%, of Verizon Communications’ $111.99 million 8.95% notes due 2039 using the 3% Treasury notes due Feb. 15, 2047 plus 185 basis points;

• $5,166,000, or 3.26%, of Verizon Communications’ $158,613,000 7.35% notes due 2039 using the 3% Treasury notes due Feb. 15, 2047 plus 185 bps;

• $11,616,000, or 7.06%, of Verizon Maryland LLC’s $164,527,000 5.125% debentures due 2033 based on the 3% Treasury notes due Feb. 15, 2047 plus 170 bps;

• $13,456,000, or 6.11%, of Verizon Communications’ $220,311,000 6.9% notes due 2038 using the 3% Treasury notes due Feb. 15, 2047 plus 175 bps;

• $33.88 million, or 8.52%, of Verizon Communications’ $397,434,000 6.4% notes due 2038 using the 3% Treasury notes due Feb. 15, 2047 plus 175 basis points;

• $49,212,000, or 26.19%, of Alltel Corp.’s $187,889,000 6.8% debentures due 2033 based on the 2.375% Treasury notes due May 15, 2027 plus 200 bps;

• $34,123,000, or 10.05%, of Verizon Communications’ $339,432,000 6.25% notes due 2037 using the 3% Treasury notes due Feb. 15, 2047 plus 170 bps;

• $41,119,000, or 13.97%, of Verizon Communications’ $294,386,000 6% notes due 2041 using the 3% Treasury notes due Feb. 15, 2047 plus 185 bps;

• $3,446,000, or 1.68%, of Verizon New York Inc.’s $205,025,000 7.375% debentures due 2032 based on the 2.375% Treasury notes due May 15, 2027 plus 205 bps;

• $47,952,000, or 8.71%, of Verizon Communications’ $550,404,000 5.85% notes due 2035 using the 3% Treasury notes due Feb. 15, 2047 plus 155 bps;

• $1,365,000, or 0.93%, of Verizon New England Inc.’s $147,062,000 7.875% debentures due 2029 based on the 2.375% Treasury notes due May 15, 2027 plus 200 bps;

• $26,344,000, or 5.60%, of Verizon Communications’ $470,844,000 6.4% notes due 2033 using the 3% Treasury notes due Feb. 15, 2047 plus 140 bps;

• $19,368,000, or 10.83%, of Verizon Communications’ $178,882,000 7.75% notes due 2032 using the 2.375% Treasury notes due May 15, 2027 plus 185 bps;

• $273,376,000, or 19.27%, of Verizon Communications’ $1,418,865,000 6.55% notes due 2043 using the 3% Treasury notes due Feb. 15, 2047 plus 180 bps;

• $987,105,000, or 78.97%, of Verizon Communications’ $1.25 billion 5.05% notes due 2034 using the 3% Treasury notes due Feb. 15, 2047 plus 145 bps;

• $163,270,000, or 48.44%, of Alltel’s $337,049,000 7.875% senior notes due 2032 based on the 2.375% Treasury notes due May 15, 2027 plus 190 bps;

• $19,676,000, or 3.38%, of Verizon Communications’ $582,856,000 7.75% notes due 2030 based on the 2.375% Treasury notes due May 15, 2027 plus 170 bps;

• $12,608,000, or 3.84%, of GTE LLC’s $327,917,000 6.94% debentures due 2028 based on the 2.375% Treasury notes due May 15, 2027 plus 150 bps;

• $9,862,000, or 8.13%, of Verizon New Jersey Inc.’s $121,254,000 8% debentures due 2022 based on the 1.875% Treasury notes due July 31, 2022 plus 100 bps;

• $28,219,000, or 35.47%, of Verizon New Jersey’s $79,554,000 7.875% debentures due 2029 based on the 2.375% Treasury notes due May 15, 2027 plus 200 bps;

• $1,108,000, or 1.57%, of Verizon New York’s $70,512,000 6.5% debentures due 2028 based on the 2.375% Treasury notes due May 15, 2027 plus 185 bps;

• $1,463,000, or 2.55%, of Verizon Pennsylvania LLC’s $57,338,000 6% debentures due 2029 based on the 2.375% Treasury notes due May 15, 2027 plus 195 bps;

• $401,000, or 0.71%, of Verizon Virginia LLC’s $56.41 million 7.875% debentures due 2022 based on the 1.875% Treasury notes due July 31, 2022 plus 95 bps;

• $117,000, or 0.32%, of Verizon Pennsylvania’s $36,126,000 8.75% debentures due 2031 based on the 2.375% Treasury notes due May 15, 2027 plus 210 bps;

• $483,000, or 1.52%, of Verizon Pennsylvania’s $31,826,000 8.35% debentures due 2030 based on the 2.375% Treasury notes due May 15, 2027 plus 200 bps;

• $361,000, or 1.30%, of Verizon Maryland’s $27,719,000 8% debentures due 2029 based on the 2.375% Treasury notes due May 15, 2027 plus 200 bps;

• $430,000, or 1.98%, of Verizon Maryland’s $27,744,000 8.3% debentures due 2031 based on the 2.375% Treasury notes due May 15, 2027 plus 210 bps;

• $186,000, or 2.02%, of Verizon Virginia’s $9,217,000 8.375% debentures due 2029 based on the 2.375% Treasury notes due May 15, 2027 plus 200 bps; and

• None of Verizon Delaware LLC’s $2,381,000 8.625% debentures due 2031 based on the 2.375% Treasury notes due May 15, 2027 plus 210 bps.

In each case, the total amount includes a $50 early premium per $1,000 of notes tendered by the early deadline of 5 p.m. ET on Aug. 11.

Holders will also receive accrued interest to the settlement date.

Verizon is using a waterfall methodology under which notes will be accepted in the order of their listed acceptance priority levels.

The tender offers were contingent on Verizon pricing debt securities with proceeds of at least $3 billion by the early deadline.

Goldman Sachs & Co. LLC (800 828-3182 or 212 902-6595), JP Morgan (866 834-4666 or 212 834-4811), Mizuho Securities (866 271-7403 or 212 205-7736) and Wells Fargo Securities (866 309-6316 or 704 410-4760) are the lead dealer managers. Loop Capital Markets LLC, Santander Investment Securities Inc., CastleOak Securities, LP and Williams Capital Group, LP are the co-dealer managers.

Global Bondholder Services Corp. (866 470-3800 or 212 430-3774) is the information agent and the tender agent.

Verizon is a New York City-based telecommunications company.

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