By Abigail W. Adams
Portland, Me., June 24 – The 2020 Cash Mandatory Exchangeable Trust priced $1.86 billion par of $1,000 three-year cash-settled mandatory securities tied to T-Mobile US, Inc. stock after the market close on Tuesday at par at the rich end of talk with a dividend of 5.25% and a threshold appreciation premium of 22.5%.
Price talk was for a dividend of 5.25% to 5.75% and a threshold appreciation premium of 17.5% to 22.5%, according to a market source.
Goldman Sachs & Co. LLC, Morgan Stanley & Co. LLC, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC were lead bookrunners for the Rule 144A offering, which carries a greenshoe of $139,535,000.
Barclays, BofA Securities, Inc., Deutsche Bank Securities Inc. and Mizuho Securities USA Inc. were also joint bookrunners.
The deal was launched as a $3.2 billion offering, which included a 7.5% greenshoe.
The securities are non-callable and have no put options. There is standard dividend protection.
Concurrently with the trust securities, T-Mobile priced a secondary offering of 143.39 million shares at $103.00 per share.
The initial size of the secondary offering was 133,548,303 shares.
Net proceeds from the common stock offering will be used by T-Mobile to repurchase an equal number of shares from a SoftBank Group Corp. subsidiary, according to a 424B5 filing with the Securities and Exchange Commission.
There will also be a rights offering.
T-Mobile plans to repurchase 19.75 million shares held by SoftBank. Shareholders of record as of June 25 will receive the right to purchase 0.05 share of common stock at the same price per share as the secondary offering.
Proceeds from the exchangeable trust offering will go to SoftBank with the securities part of SoftBank’s efforts to monetize a portion of its stake in T-Mobile.
Following the offering, T-Mobile parent company Deutsche Telekom AG will hold 43.5% and SoftBank will hold 8.6% of T-Mobile common stock, according to the 424B5 filing.
SoftBank is a Tokyo-based multinational conglomerate holding company.
T-Mobile is a Bonn, Germany-based telecommunications company.
| Issuer: | 2020 Cash Mandatory Exchangeable Trust
|
| Securities: | Cash-settled mandatory securities tied to T-Mobile US, Inc.
|
| Amount: | $1.86 billion
|
| Greenshoe: | $139,535,000
|
| Maturity: | June 1, 2023
|
| Lead bookrunners: | Goldman Sachs & Co. LLC, Morgan Stanley & Co. LLC, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC
|
| Joint bookrunners: | Barclays, BofA Securities, Inc., Deutsche Bank Securities Inc. and Mizuho Securities USA Inc.
|
| Dividend: | 5.25%
|
| Price: | Par
|
| Yield: | 5.25%
|
| Appreciation premium: | 22.5%
|
| Appreciation price: | $126.18
|
| Exchange rate: | Minimum 7.9255, maximum 9.7087
|
| Call options: | Non-callable
|
| Put options: | None
|
| Pricing date: | June 23
|
| Settlement date: | June 26
|
| Distribution: | Rule 144A
|
| Talk: | Dividend of 5.25% to 5.75% and threshold appreciation premium of 17.5% to 22.5%
|
| Stock symbol: | Nasdaq: TMUS
|
| Stock price: | $103.00 in concurrent offering
|
| Market capitalization: | $132.42 billion
|
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