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 $750 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.
28, 2018 (the “Offer to Purchase”) (collectively, the “Notes”). The
terms and conditions of the Tender Offer are described in the Offer
to Purchase, as amended by Macy’s, Inc.’s press release issued
earlier today, and the related Letter of Transmittal dated Nov. 28,
2018 (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. 12, 2018, by the Dealer Managers (identified
below). The Total Tender Offer Consideration for each series of
Notes includes an early tender premium of $30.00 per $1,000
principal amount of Notes accepted for purchase by the Company.
The following table sets forth pricing information for the
Tender Offer:
Fixed Total Tender
Spread Offer CUSIP Reference
(basis Consideration Number Title of
Security Reference U.S. Treasury Security Yield
points) (1) 577778CB7 6.65% Senior Debentures due
2024 2.875% U.S. Treasury due 10/31/2023 2.773% 180 $1,101.37
577778BL6 8.75% Senior Debentures due 2029 3.125% U.S.
Treasury due 11/15/2028 2.901% 325 $1,197.73 577778BK8
7.875% Senior Debentures due 2030 3.125% U.S. Treasury due
11/15/2028 2.901% 325 $1,138.07 577778BQ5 6.9% Senior
Debentures due 2032 3.125% U.S. Treasury due 11/15/2028 2.901% 320
$1,071.25 577778CE1 6.7% Senior Debentures due 2034 3.00%
U.S. Treasury due 8/15/2048 3.142% 320 $1,035.04 314275AC2
6.375% Senior Notes due 2037 3.00% U.S. Treasury due 8/15/2048
3.142% 320 $1,003.41 31410HAQ4 6.9% Senior Debentures due
2029 3.125% U.S. Treasury due 11/15/2028 2.901% 285 $1,088.26
577778BH5 6.7% Senior Debentures due 2028 3.125% U.S.
Treasury due 11/15/2028 2.901% 285 $1,069.99 55616XAC1 7.0%
Senior Debentures due 2028 3.125% U.S. Treasury due 11/15/2028
2.901% 275 $1,095.42 55616XAB3 6.79% Senior Debentures due
2027 3.125% U.S. Treasury due 11/15/2028 2.901% 270 $1,080.13
55616XAM9 4.5% Senior Notes due 2034 3.00% U.S. Treasury due
8/15/2048 3.142% 310 $825.26 (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. 11, 2018 (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. 13,
2018.
As a result of the Tender Offer, Macy’s, Inc. expects to record
a one-time pre-tax charge of approximately $28 million in the
fourth fiscal quarter of 2018. By completing the Tender Offer,
Macy’s interest expense is anticipated to be reduced on a full year
basis by approximately $47 million. The one-time pre-tax charge is
excluded from guidance.
Although the Tender Offer is scheduled to expire at 11:59 p.m.,
New York City time, on Dec. 26, 2018, 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 (toll-free) (800)
761-6523, collect at (212) 269-5550 or by email to
macys@dfking.com. Questions regarding the tendering of Notes may be
directed to D.F. King & Co., Inc. at (toll-free) (800)
761-6523, collect at (212) 269-5550 or by email to
macys@dfking.com.
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, as amended by Macy’s, Inc.’s
press release issued earlier today, and the information in this
press release is qualified by reference to the Offer to Purchase
and related Letter of Transmittal, as amended. None of Macy’s or
its affiliates, their respective boards of directors, the Dealer
Managers, the Tender Agent, the 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 2017 sales of $24.837 billion and approximately 130,000
employees, the company operates approximately 690 department stores
under the nameplates Macy’s and Bloomingdale’s, and more than 180
specialty stores that include Bloomingdale’s The Outlet,
Bluemercury, Macy’s Backstage and STORY. Macy’s, Inc. operates
stores in 44 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 real estate
and other transactions, prevailing interest rates and non-recurring
charges, the effect of federal tax reform, store closings,
competitive pressures from specialty stores, general merchandise
stores, off-price and discount stores, manufacturers’ outlets, the
Internet, mail-order catalogs and television shopping and general
consumer spending levels, including the impact of the availability
and level of consumer debt, the effect of weather and other factors
identified in documents filed by Macy’s with the Securities and
Exchange Commission. Macy’s disclaims any intention or obligation
to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise, except as
required by law.
(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: https://www.businesswire.com/news/home/20181212005789/en/
Media – Radina
Russell646-429-7358Radina.russell@macys.com
Investors – Monica
Koehler513-579-7780investors@macys.com
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