BHP Billiton issues make-whole call for $500 million of 2.05% notes

By Susanna Moon

Chicago, March 21 – BHP Billiton plc issued a make-whole redemption notice for its $500 million principal amount of 2.05% senior notes due 2018, according to a 6-K filing with the Securities and Exchange Commission.

The notes will be redeemed on March 23 at a make-whole redemption price of $1,020.28 per $1,000 principal amount, which includes accrued interest of $9.85.

As announced Feb. 21, BHP Billiton Finance (USA) Ltd. also was offering to purchase up to $1.95 billion of the 2019, 2021, 2022 and 2023 notes.

In the tenders, BHP Billiton Finance (USA) Ltd., a wholly owned subsidiary, was offering to purchase any and all of its $1.75 billion 6.5% senior notes due 2019, as well as a capped amount of its $1.25 billion 3.25% senior notes due 2021, $1 billion 2.875% senior notes due 2022 and $1.5 billion 3.85% senior notes due 2023.

On Tuesday, the company said it repurchased $979,966,000 principal amount of the 6.5% notes, $720,022,000 of the 3.25% notes, $140,062,000 of the 2.875% notes and none of the 3.85% notes.

Pricing for the capped offers was set at 11 a.m. ET on March 7 using a reference security plus a fixed spread for a total purchase price per $1,000 principal amount as follows:

• $1,042.21 for the 3.25% notes with pricing using the 1.875% U.S. Treasury note due Jan. 31, 2022 plus 25 bps for a reference yield of 2.047%;

• $1,024.57 for the 2.875% notes with pricing based on the 1.875% U.S. Treasury note due Jan. 31, 2022 plus 30 bps for a reference yield of 2.047%; and

• $1,068.87 for the 3.85% notes with pricing based on the 1.875% U.S. Treasury note due Jan. 31, 2022 plus 65 bps for a reference yield of 2.047%.

In the capped offers, each total purchase price included a $30.00 early tender premium per $1,000 principal amount of notes tendered by the early tender deadline.

Holders also will receive accrued interest.

The capped offers were set to end at 11:59 p.m. ET on March 20, but they were oversubscribed as of the early deadline when the company decided to lift the cap to $893,918,713.32 from $863,918,713.32.

The maximum amount was originally set for $1.95 billion less the purchase price excluding accrued interest of the any-and-all notes.

Investors had tendered $2,119,861,000 principal amount of notes before 5 p.m. ET on March 6, the early tender date.

Specifically, holders had tendered $720,022,000 principal amount of the 2021 notes, $642.76 million principal amount of the 2022 notes and $757,079,000 principal amount of the 2023 notes.

Any-and-all offer

As announced Feb. 28, investors had tendered $980,802,000 of BHP Billiton Finance (USA) Ltd.’s $1.75 billion 6.5% senior notes due 2019 in the any-and-all offer that ended at 5 p.m. ET on Feb. 27.

In the any-and-all offer, the total purchase price is $1,107.34 per $1,000 principal amount of 6.5% notes due 2019. Pricing was set using the 1.125% U.S. Treasury note due Jan. 31, 2019 plus 10 basis points at 11 a.m. ET on Feb. 27.

Settlement was set for March 2.

The joint lead dealer managers are BofA Merrill Lynch (888 292-0070, 980 387-3907, +44 20 7996 5420 or DG.LM_EMEA@BAML.com), Citigroup Global Markets Ltd. (800 558-3745, 212 723-6106, +44 20 7986 8969 or liabilitymanagement.europe@citi.com) and RBC Capital Markets, LLC (877 381-2099, 212 618-7822, +44 20 7029 7063 or liability.management@rbccm.com).

The co-dealer managers are BNP Paribas, CIBC Capital Markets, HSBC and Societe Generale CIB. The tender and information agent for the tender offers is Global Bondholders Services Corp. (212 430-3774, 866 470-3800, fax 212 430-3775, 212 430-3779 or gbsc-usa.com/bhpbilliton/).

BHP Billiton is a diversified natural resources company based in Melbourne, Australia.

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