Kraft lifts tender offer cap for four series of notes to $2.5 billion

By Sarah Lizee

Olympia, Wash., Sept. 12 – Kraft Heinz Co. subsidiary Kraft Heinz Foods Co. increased the cap of its offer to purchase for cash four series of notes to $2.5 billion from $1 billion, according to a press release.

Other terms of the tender offer are unchanged.

Notes covered by the capped tender offer include the following, listed in order of acceptance priority level:

• $2 billion 3.5% senior notes due June 2022, with pricing to be set using the 1.5% Treasury due Aug. 15, 2022 plus a fixed spread of 90 basis points;

• $1 billion 3.5% senior notes due July 2022, with pricing to be set using the 1.5% Treasury due Aug. 15, 2022 plus a fixed spread of 90 bps;

• $1.6 billion 4% senior notes due 2023, with pricing to be set using the 1.25% Treasury due Aug. 31, 2024 plus a fixed spread of 115 bps; and

• $1.2 billion 4.875% second-lien senior secured notes due 2025, with pricing to be set using the 1.375% Treasury due Feb. 15, 2020 plus a fixed spread of 75 bps.

Holders who tender their notes by the early tender deadline will be eligible to receive the early tender premium, which is $30 per $1,000 of notes for each series.

The tender offer is subject to the issuer receiving $1.5 billion of proceeds from a private offering.

Kraft Heinz also intends to issue a notice of conditional partial redemption providing for the redemption of $500 million of its remaining 2.8% senior notes due 2020 at a redemption price of par plus the applicable redemption premium and accrued interest, if any, to but not including Oct. 11.

The tender offer will expire at 11:59 p.m. ET on Oct. 8.

Tendered notes may be withdrawn before the early tender deadline, 5 p.m. ET on Sept. 24.

Pricing will be set at 10 a.m. ET on Sept. 25.

Early settlement is expected for Sept. 26. Final settlement is expected for Oct. 9.

Global Bondholders Services Corp. is the tender agent and information agent (866 794-2200 toll free or 212 430-3774 for banks and brokers).

The dealer managers are BofA Merrill Lynch (980 387-3907 toll free or 888 292-0070 collect), Citigroup (800 558-3745 toll free or 212 723-6106 collect), Goldman Sachs & Co. LLC (800 828-3182 toll free or 212 357-0215 collect) and J.P. Morgan at (866 834-4666 toll free or 212 834-8553 collect).

Kraft Heinz is a Chicago-based food company.

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