HP announces tender’s early results, raises cap to $1.85 billion

New York, March 23 – HP Inc. announced the response by the early deadline in its tender offer for seven series of notes and raised the cap to $1,849,841,000 from $1.75 billion, according to a news release.

The company said that it will accept all the tendered notes with priority acceptance levels of one through three and no others.

Because the offer is oversubscribed by the early deadline no further notes will be accepted for purchase.

Holders tendered the following notes by the early deadline of 5 p.m. ET on March 22:

• $804,838,000, or 53.66%, of the $1.5 billion of 4.65% global notes due Dec. 9, 2021. All the tendered notes will be accepted for purchase. Pricing will be set using the 2.25% Treasury notes due Feb. 15, 2021 plus 55 basis points for a total hypothetical purchase price of $1,058.82;

• $462,082,000, or 46.21%, of the $1 billion of 4.375% global notes due Sept. 15, 2021. All the tendered notes will be accepted for purchase. Pricing will be set using the 2.25% Treasury notes due Feb. 15, 2021 plus 55 bps for a total hypothetical purchase price of $1,046.32; and

• $582,921,000, or 46.63%, of the $1.25 billion of 4.3% global notes due June 1, 2021. All the tendered notes will be accepted for purchase. Pricing will be set using the 2.25% Treasury notes due Feb. 15, 2021 plus 50 bps for a total hypothetical purchase price of $1,041.90.

The three issues are listed in order of priority acceptance level and had a tender sub-cap of $1.75 billion, now raised to $1,849,841,000.

HP also received the following tenders:

• $96,182,000, or 19.24%, of its $500 million of 4.05% global notes due Sept. 15, 2022 with acceptance priority of four. None of these tenders will be accepted. Pricing was to be set using the 2.625% Treasury notes due Feb. 28, 2023 plus 55 bps for a total hypothetical purchase price of $1,036.06; and

• $182,813,000, or 28.18%, of its $648,781,000 of 3.75% global notes due Dec. 1, 2020 with acceptance priority of five. None of these tenders will be accepted. Pricing was to be set using the 2.25% Treasury notes due Feb. 29, 2020 plus 55 bps for a total hypothetical purchase price of $1,024.34.

These two issues had a tender sub-cap of $450 million.

HP also received tenders for $199,725,000, or 16.64% of its $1.2 billion of 6% global notes due Sept. 15, 2041 with acceptance priority of six. None of these tenders will be accepted. Pricing was to be set using the 2.75% Treasury notes due Nov. 15, 2047 plus 225 bps for a total hypothetical purchase price of $1,082.63. The notes had a sub-cap of $300 million.

And, HP received tenders for $83,555,000, or 27.87%, of its $299,794,000 of 2.75% global notes due Jan. 14, 2019 with acceptance priority of seven. None of these tenders will be accepted. Pricing was to be set using the 1.125% Treasury notes due Jan. 15, 2019 plus 20 bps for a total hypothetical purchase price of $1,003.80. There was no sub-cap for these notes.

All purchase prices include an early tender premium of $30 per $1,000 principal amount of notes tendered by the early deadline of 5 p.m. ET on March 22.

The hypothetical pricing was calculated at 11 a.m. ET on March 8, assuming a settlement date of March 26.

Pricing was to be set at 11 a.m. ET on March 23.

Along with the tender, HP was soliciting consents from holders of its 4.65% notes due Dec. 9, 2021 to amend the issue to eliminate substantially all of the restrictive covenants.

Holders who tender their 4.65% notes must also consent to the proposed amendments.

The total price for the 4.65% notes includes a consent fee for consents.

HP said Friday that the necessary majority of consents had been given.

There are no guaranteed delivery provisions for the tender offer or consent solicitation.

HP announced the offer on March 9.

BofA Merrill Lynch (888 292-0070 or 980 387-3907) and Citigroup Global Markets Inc. (800 558-3745 or 212 723-6106) are the dealer managers and the solicitation agents. Global Bondholder Services Corp. (212 430-3774 or 866 924-2200) is the tender agent and the information agent.

HP is a Palo Alto, Calif.-based technology company that has a portfolio of printers, PCs, mobile devices, solutions and services.

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