AT&T Inc. (NYSE: T) (“AT&T”) announced today pricing
terms with respect to its private offers to (i) exchange four
series of notes issued by AT&T (collectively, the “Pool 1
Notes”) for a combination of cash and a new series of AT&T’s
senior notes to be due in 2057 (the “New 2057 Notes”) as described
in the table below. For each $1,000 principal amount of Pool 1
Notes validly tendered and not validly withdrawn prior to 5:00
p.m., New York City time, on December 1, 2020 and accepted by
AT&T, the following table sets forth the yields, the total
consideration, the principal amount of the New 2057 Notes and the
amount of cash, as priced below:
Title of Security
Issuer
CUSIP
Number(s)
Acceptance
Priority
Level
Reference
UST
Security
Reference
Yield(1)
Fixed
Spread
(basis points)
Yield(2)
Cash Payment
Percent of
Premium(3)
Total
Consideration(4)
Principal
Amount of
New 2057 Notes
Cash
Pool 1 Notes
4.800% Global
Notes due 2044*
AT&T Inc.
00206RCG5
1
1.375% due
8/15/2050
1.709%
170
3.409%
0%
$1,220.65
$1,222.81
$0
4.500% Global
Notes due 2048*
AT&T Inc.
00206RDL3 /
00206RDJ8
2
1.375% due
8/15/2050
1.709%
180
3.509%
0%
$1,171.02
$1,173.10
$0
4.35% Global
Notes due 2045*
AT&T Inc.
00206RBK7 /
U04644AE7
3
1.375% due
8/15/2050
1.709%
170
3.409%
0%
$1,153.48
$1,155.53
$0
4.30% Global
Notes due 2042*
AT&T Inc.
00206RBH4 /
00206RBG6
4
1.375% due
8/15/2050
1.709%
160
3.309%
0%
$1,151.70
$1,153.74
$0
(1) The bid-side yield on the Reference UST
Security. (2) Reflects the bid-side yield on the Reference UST
Security plus the applicable Fixed Spread, calculated in accordance
with the procedures set forth in the Offering Memorandum, dated
November 17, 2020 (the “Offering Memorandum”). (3) The cash payment
percent of premium is the percent of the amount by which the total
consideration exceeds $1,000 in principal amount and cash per
$1,000 principal amount of such Old Notes. (4) The total
consideration for each series of Pool 1 Notes includes the early
participation payment of $50 of principal amount of New 2057 Notes
per $1,000 principal amount of Pool 1 Notes and assumes a
settlement date of December 7, 2020.
* Denotes a series of Old Notes for which the
total consideration and exchange consideration will be determined
taking into account the par call date, instead of the maturity
date, in accordance with standard market practice.
and (ii) exchange nine series of notes issued by AT&T and
certain of AT&T’s wholly-owned subsidiaries (collectively, the
“Pool 2 Notes” and, together with the Pool 1 Notes, the “Old
Notes”) for a combination of cash and a new series of AT&T’s
senior notes to be due in 2033 (the “New 2033 Notes” and, together
with the New 2057 Notes, the “New Notes”) as described in the table
below. For each $1,000 principal amount of Pool 2 Notes validly
tendered and not validly withdrawn prior to 5:00 p.m. New York City
time on December 1, 2020 and accepted by AT&T, the following
table sets forth the yields, the total consideration, the principal
amount of the New 2033 Notes and the amount of cash, as priced
below:
Title of Security
Issuer
CUSIP
Number(s)
Acceptance
Priority
Level
Reference
UST Security
Reference
Yield(1)
Fixed
Spread
(basis points)
Yield(2)
Cash Payment
Percent of
Premium(3)
Total
Consideration(4)
Principal
Amount of
New 2033 Notes
Cash
Pool 2 Notes
7 1/8% Debentures
due March 15, 2026**+
Pacific Bell
Telephone
Company(5)(6)
694032AT0
1
0.250% due
10/31/2025
0.422%
80
1.222%
100%
$1,300.49
$1,000.33
$300.49
4.125% Global
Notes due 2026*
AT&T Inc.
00206RCT7
2
0.250% due
10/31/2025
0.422%
45
0.872%
0%
$1,157.09
$1,157.47
$0
3.875% Global
Notes due 2026*
AT&T Inc.
00206RHT2
3
0.250% due
10/31/2025
0.422%
45
0.872%
0%
$1,142.47
$1,142.85
$0
2.950% Global
Notes due 2026*
AT&T Inc.
00206RHV7
4
0.250% due
10/31/2025
0.422%
50
0.922%
0%
$1,105.74
$1,106.11
$0
6.55% Debentures
due January 15, 2028+
Ameritech Capital
Funding Corporation(7)
030955AN8
5
0.875% due
11/15/2030
0.953%
85
1.803%
55%
$1,315.23
$1,142.23
$173.38
6 3/8% Debentures
due June 1, 2028
BellSouth
Telecommunications,
LLC(8)
079867AW7
6
0.875% due
11/15/2030
0.953%
90
1.853%
40%
$1,314.62
$1,189.16
$125.85
4.100% Global
Notes due 2028*
AT&T Inc.
00206RGL0 /
00206RER9 /
U04644BB2
7
0.875% due
11/15/2030
0.953%
50
1.453%
0%
$1,174.12
$1,174.51
$0
4.250% Global
Notes due 2027*
AT&T Inc.
00206RDQ2
8
0.875% due
11/15/2030
0.953%
35
1.303%
0%
$1,169.10
$1,169.49
$0
3.800% Global
Notes due 2027*
AT&T Inc.
00206RHW5
9
0.875% due
11/15/2030
0.953%
35
1.303%
0%
$1,142.26
$1,142.64
$0
(1) The bid-side yield on the Reference UST
Security. (2) Reflects the bid-side yield on the Reference UST
Security plus the applicable Fixed Spread, calculated in accordance
with the procedures set forth in the Offering Memorandum. (3) The
cash payment percent of premium is the percent of the amount by
which the total consideration exceeds $1,000 in principal amount
and cash per $1,000 principal amount of such Old Notes. (4) The
total consideration for each series of Pool 2 Notes includes the
early participation payment of $50 of principal amount of New 2033
Notes per $1,000 principal amount of Pool 2 Notes and assumes a
settlement date of December 7, 2020. (5) Pacific Bell Telephone
Company was formerly known as Pacific Bell. (6) The 7 1/8%
Debentures due March 15, 2026 are unconditionally and irrevocably
guaranteed by AT&T. (7) The 6.55% Debentures due January 15,
2028 are unconditionally and irrevocably guaranteed by AT&T,
with the full amount payable by AT&T so long as all of the
outstanding shares of stock of this subsidiary are owned, directly
or indirectly, by AT&T. In the event AT&T sells, transfers
or otherwise disposes of any percentage of its stock ownership and
this subsidiary is no longer wholly-owned, then the guarantee will
expire immediately and AT&T will be released immediately from
any and all of its obligations. (8) BellSouth Telecommunications,
LLC converted from BellSouth Telecommunications, Inc.
* Denotes a series of Old Notes for which the
total consideration and exchange consideration will be determined
taking into account the par call date, instead of the maturity
date, in accordance with standard market practice. ** Denotes a
series of Old Notes, a portion of which is held in physical
certificated form (such portion, the “Certificated Notes”) and is
not held through The Depositary Trust Company. Such Certificated
Notes may only be tendered in accordance with the terms and
conditions of the accompanying letter of transmittal. With respect
to the Certificated Notes, all references to the offering
memorandum herein shall also include the letter of transmittal. +
Denotes a series of Old Notes with respect to which, as a result of
a prior consent solicitation and execution of a supplemental
indenture, substantially all restrictive covenants, certain events
of default and other provisions were eliminated from the indenture
governing this series.
In addition, holders whose Old Notes are accepted for exchange
will receive in cash accrued and unpaid interest from the last
applicable interest payment date to, but excluding, the date on
which the exchange of such Old Notes is settled, and amounts due in
lieu of fractional amounts of New Notes.
On the early settlement date (expected to be December 7, 2020),
AT&T expects (i) to accept all of the Pool 1 Notes and Pool 2
Notes validly tendered and not validly withdrawn at or before 5:00
p.m. New York City time on December 1, 2020 (the “Early
Participation Date”) in accordance with the terms of the Exchange
Offers, and (ii) to issue $5,923,400,000 aggregate principal amount
of the New 2057 Notes and $3,754,741,000 aggregate principal amount
of the New 2033 Notes.
The exchange offers described in this press release (the
“Exchange Offers”) are being conducted upon the terms and subject
to the conditions set forth in the Offering Memorandum (as amended
by AT&T’s press release, dated as of December 2, 2020) and the
related letter of transmittal.
Only Eligible Holders (as defined below) of Old Notes who
validly tendered their Old Notes at or before the Early
Participation Date, and who did not validly withdraw their tenders
and whose Old Notes are accepted for exchange, will receive an
early participation payment. As of the Early Participation Date the
Exchange Offers were fully subscribed and as such no additional Old
Notes tendered after the Early Participation Date will be
accepted.
The interest rate on the New 2057 Notes will be 3.800% and the
interest rate on the New 2033 Notes will be 2.550%. The yield on
the New 2057 Notes will be 3.809%, and the New Issue Price of the
New 2057 Notes will be $998.23, which has been determined by
reference to the bid-side yield on the 1.375% U.S. Treasury Notes
due August 15, 2050, as of 11:00 a.m. New York City time on
December 2, 2020 (such date and time, the “Pricing Time”), which
was 1.709%, plus 2.10%. The yield on the New 2033 Notes will be
2.553%, and the New Issue Price of the New 2033 Notes will be
$999.67, which has been determined by reference to the bid-side
yield on the 0.875% U.S. Treasury Notes due November 15, 2030, as
of the Pricing Time, which was 0.953%, plus 1.60%.
The Exchange Offers will expire at 11:59 p.m., New York City
time, on December 15, 2020, unless extended or earlier terminated
by AT&T (the “Expiration Date”). The withdrawal deadline for
the Exchange Offers occurred at 5:00 p.m. New York City time on
December 1, 2020. As a result, tendered Old Notes may no longer be
withdrawn, except in certain limited circumstances where additional
withdrawal rights are required by law (as determined by
AT&T).
The Exchange Offers are only being made, and the New Notes are
only being offered and will only be issued, and copies of the
offering documents will only be made available, to a holder of Old
Notes who has certified its status as either (a) if in the United
States, a “qualified institutional buyer,” or “QIB,” as that term
is defined in Rule 144A under the United States Securities Act of
1933, as amended (the “Securities Act”), in a private transaction
in reliance upon an exemption from the registration requirements of
the Securities Act or (b) (i) if outside the United States, a
person other than a “U.S. person,” as that term is defined in Rule
902 under the Securities Act, in offshore transactions in reliance
upon Regulation S under the Securities Act, or a dealer or other
professional fiduciary organized, incorporated or (if an
individual) residing in the United States holding a discretionary
account or similar account (other than an estate or a trust) for
the benefit or account of a non-“U.S. person,” (ii) if located or
resident in any Member State of the European Economic Area or in
the United Kingdom, persons other than “retail investors” (for
these purposes, a retail investor means a person who is one (or
more) of: (1) a retail client as defined in point (11) of Article
4(1) of Directive 2014/65/EU (as amended, “MiFID II”); or (2) a
customer within the meaning of Directive (EU) 2016/97, as amended,
where that customer would not qualify as a professional client as
defined in point (10) of Article 4(1) of MiFID II; or (3) not a
“qualified investor” as defined in Regulation (EU) 2017/1129, as
amended, and part II of the Luxembourg law dated July 10, 2005 on
prospectuses for securities, as amended), and consequently no key
information document required by Regulation (EU) No 1286/2014 (as
amended, the “PRIIPs Regulation”) for offering or selling the New
Notes or otherwise making them available to retail investors in the
European Economic Area or in the United Kingdom has been prepared
and therefore offering or selling the New Notes or otherwise making
them available to any retail investor in the European Economic Area
or in the United Kingdom may be unlawful under the PRIIPs
Regulation and (iii) if located or resident in Canada, a holder
located or resident in a province of Canada and an “accredited
investor” as such term is defined in National Instrument 45-106 –
Prospectus Exemptions, and, if resident in Ontario, section 73.3(1)
of the Securities Act (Ontario), in each case, that is not an
individual unless that person is also a “permitted client” as
defined in National Instrument 31-103 - Registration Requirements,
Exemptions and Ongoing Registrant Obligations (each, an “Eligible
Holder”). Only Eligible Holders who have confirmed they are
Eligible Holders via the eligibility certification are authorized
to receive or review the offering memorandum, letter of
transmittal, eligibility certification and Canadian beneficial
holder form or to participate in the Exchange Offers. For Canadian
Eligible Holders tendering Old Notes, such participation is also
conditioned upon the receipt of the Canadian beneficial holder
form.
The New Notes have not been registered under the Securities Act
or any state securities laws. Therefore, the New Notes may not be
offered or sold in the United States absent registration or an
applicable exemption from the registration requirements of the
Securities Act and any applicable state securities laws.
Holders are advised to check with any bank, securities broker
or other intermediary through which they hold Old Notes as to when
such intermediary needs to receive instructions from a holder in
order for that holder to be able to participate in, or (in the
circumstances in which revocation is permitted) revoke their
instruction to participate in the Exchange Offers before the
deadlines specified herein and in the offering memorandum, letter
of transmittal, eligibility certification and Canadian beneficial
holder form. The deadlines set by each clearing system for the
submission and withdrawal of exchange instructions will also be
earlier than the relevant deadlines specified herein and in the
offering memorandum, letter of transmittal, eligibility
certification and Canadian beneficial holder form.
This press release is not an offer to sell or a solicitation of
an offer to buy any of the securities described herein. The
Exchange Offers are being made solely by the offering memorandum,
letter of transmittal, eligibility certification and Canadian
beneficial holder form and only to such persons and in such
jurisdictions as is permitted under applicable law.
In the United Kingdom, this press release is only being
communicated to, and any other documents or materials relating to
the Exchange Offers are only being distributed to and are only
directed at, (i) persons who are outside the United Kingdom, (ii)
investment professionals falling within Article 19(5) of the
Financial Services and Markets Act 2000 (Financial Promotion) Order
2005, as amended (the “Order”) or (iii) high net worth entities,
and other persons to whom it may lawfully be communicated, falling
within Articles 49(2)(a) to (d) of the Order (all such persons
together being referred to as “relevant persons”). Any investment
or investment activity to which this announcement relates is
available only to relevant persons and will be engaged in only with
relevant persons. Any person who is not a relevant person should
not act or rely on this announcement or any of its contents.
Global Bondholder Services Corporation is acting as the exchange
agent and information agent for the Exchange Offers. Documents
relating to the Exchange Offers will only be distributed to holders
of Old Notes who certify that they are Eligible Holders. Questions
or requests for assistance related to the Exchange Offers or for
additional copies of the offering memorandum, letter of
transmittal, eligibility certification or Canadian beneficial
holder form may be directed to Global Bondholder Services
Corporation at (866) 470-3900 (toll free) or (212) 430-3774
(collect). You may also contact your broker, dealer, commercial
bank, trust company or other nominee for assistance concerning the
Exchange Offers. The offering memorandum, letter of transmittal,
eligibility certification and Canadian beneficial holder form can
be accessed at the following link:
https://gbsc-usa.com/eligibility/att.
CAUTIONARY LANGUAGE CONCERNING FORWARD-LOOKING STATEMENTS
Information set forth in this news release contains
forward-looking statements that are subject to risks and
uncertainties, and actual results may differ materially. A
discussion of factors that may affect future results is contained
in AT&T’s filings with the Securities and Exchange Commission
and in the offering memorandum related to the Exchange Offers.
AT&T disclaims any obligation to update or revise statements
contained in this news release based on new information or
otherwise.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201202005967/en/
For more information, contact: McCall Butler AT&T
Corporate and Financial Communications Phone: (470) 773-5704 Email:
mb8191@att.com
For holders of notes, contact: Global Bondholder Services
Corporation Phone: (866) 470-3900 (toll free) (212) 430-3774
(collect)
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