Macy’s, Inc. (NYSE:M) today announced the pricing terms of the
previously announced tender offer (the “Tender Offer”) of its
wholly owned subsidiary, Macy’s Retail Holdings, Inc. (the
“Company”), to purchase up to $400 million in aggregate principal
amount (the “Maximum Tender Offer Amount”) of the outstanding debt
securities identified in the Company’s Offer to Purchase dated Nov.
27, 2017 (the “Offer to Purchase”) (collectively, the “Notes”). The
terms and conditions of the Tender Offer are described in the Offer
to Purchase and the related Letter of Transmittal dated Nov. 27,
2017 (the “Letter of Transmittal”).
The total consideration to be paid in the Tender Offer for each
series of Notes accepted for purchase was determined by reference
to a fixed spread specified for such series of Notes over the yield
(the “Reference Yield”) based on the bid-side price of the
applicable U.S. Treasury Security, in each case as set forth in the
table below (the “Total Tender Offer Consideration”). The Reference
Yields (as determined pursuant to the Offer to Purchase) listed in
the table below were determined at 11 a.m., New York City time,
today, Dec. 11, 2017, by the Dealer Managers (identified below).
The Total Tender Offer Consideration for each series of Notes
includes an early tender premium of $30 per $1,000 principal amount
of Notes accepted for purchase by the Company.
The following table sets forth pricing information for the
Tender Offer:
Total Tender
Reference Fixed Spread Offer Title of
Security CUSIP Number Reference U.S. Treasury
Security Yield (basis points) Consideration
(1) 8.75% Senior Debentures due 2029 577778BL6 2.25% U.S.
Treasury due 11/15/2027 2.365% 395 $1,195.99 7.875% Senior
Debentures due 2030 577778BK8 2.25% U.S. Treasury due 11/15/2027
2.365% 400 $1,126.76 6.7% Senior Debentures due 2034 577778CE1
2.75% U.S. Treasury due 8/15/2047 2.753% 380 $1,014.66 6.9% Senior
Debentures due 2032 577778BQ5 2.25% U.S. Treasury due 11/15/2027
2.365% 380 $1,068.47 6.375% Senior Notes due 2037 314275AC2 2.75%
U.S. Treasury due 8/15/2047 2.753% 350 $1,013.43
(1) Per $1,000 principal amount of the Notes that are accepted
for purchase.
All payments for Notes tendered on or before 5 p.m., New York
City time, on Dec. 8, 2017 (the “Early Tender Date”) that are
purchased by the Company will also include accrued and unpaid
interest on the principal amount of Notes tendered and accepted for
purchase from the last interest payment date applicable to the
relevant series of Notes up to, but not including, the early
settlement date, which is currently expected to be Dec. 12,
2017.
As a result of the Tender Offer, Macy’s, Inc. expects to record
a one-time pre-tax gain of approximately $13 million in the fourth
fiscal quarter of 2017. By completing the Tender Offer, Macy’s
interest expense is anticipated to be reduced on a full year basis
by approximately $26 million. The net interest savings in the
fourth quarter resulting from this transaction was included in our
previously provided guidance. The one-time pre-tax gain is excluded
from guidance.
Although the Tender Offer is scheduled to expire at 11:59 p.m.,
New York City time, on Dec. 22, 2017, because holders of Notes
subject to the Tender Offer validly tendered and did not validly
withdraw Notes on or before the Early Tender Date in an amount that
exceeds the Maximum Tender Offer Amount, the Company does not
expect to accept for purchase any tenders of Notes after the Early
Tender Date.
BofA Merrill Lynch, Credit Suisse Securities (USA) LLC, J.P.
Morgan Securities LLC and Wells Fargo Securities, LLC are the
Dealer Managers for the Tender Offer. D.F. King & Co., Inc. is
the Tender Agent and Information Agent. Persons with questions
regarding the Tender Offer should contact BofA Merrill Lynch at
(toll-free) (888) 292-0070, Credit Suisse Securities (USA) LLC at
(toll-free) (800) 820-1653, J.P. Morgan Securities LLC at
(toll-free) (866) 834-4666 and Wells Fargo Securities, LLC at
(toll-free) (866) 309-6316. Requests for copies of the Offer to
Purchase, Letter of Transmittal and related materials should be
directed to D.F. King & Co., Inc. at (212) 269-5550,
(toll-free) (866) 406-2284 or macys@dfking.com. Questions regarding
the tendering of Notes may be directed to D.F. King & Co., Inc.
at (toll-free) (866) 406-2284.
This press release is neither an offer to purchase nor a
solicitation of an offer to sell the Notes. The Tender Offer is
made only by the Offer to Purchase and the information in this
press release is qualified by reference to the Offer to Purchase
and related Letter of Transmittal. None of Macy’s or its
affiliates, their respective boards of directors, the Dealer
Managers, the Tender Agent and Information Agent or the trustees
with respect to any Notes is making any recommendation as to
whether holders should tender any Notes in response to the Tender
Offer, and neither Macy’s nor any such other person has authorized
any person to make any such recommendation. Holders must make their
own decision as to whether to tender any of their Notes, and, if
so, the principal amount of Notes to tender.
Macy’s, Inc., is one of the nation’s premier retailers. With
fiscal 2016 sales of $25.778 billion and approximately 140,000
employees, the company operates more than 700 department stores
under the nameplates Macy’s and Bloomingdale’s, and approximately
160 specialty stores that include Bloomingdale’s The Outlet,
Bluemercury and Macy’s Backstage. Macy’s, Inc. operates stores in
45 states, the District of Columbia, Guam and Puerto Rico, as well
as macys.com, bloomingdales.com and bluemercury.com. Bloomingdale’s
stores in Dubai and Kuwait are operated by Al Tayer Group LLC under
license agreements. Macy’s, Inc. has corporate offices in
Cincinnati, Ohio, and New York, New York.
All statements in this press release that are not statements of
historical fact are forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. Such
statements are based upon the current beliefs and expectations of
Macy’s management and are subject to significant risks and
uncertainties. Actual results could differ materially from those
expressed in or implied by the forward-looking statements contained
in this release because of a variety of factors, including
conditions to, or changes in the timing of, proposed transactions,
changes in the conditions of the securities markets, particularly
the markets for debt securities and other factors identified in
documents filed by Macy’s with the Securities and Exchange
Commission.
(NOTE: Additional information on Macy’s, Inc., including past
press releases, is available at www.macysinc.com/pressroom).
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version on businesswire.com: http://www.businesswire.com/news/home/20171211005994/en/
Macy’s, Inc.Media:Radina Russell,
646-429-7358media@macys.comorInvestors:Monica
Koehler, 513-579-7780investors@macys.com
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