NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO, OR TO
ANY PERSON RESIDENT AND/OR LOCATED IN, ANY JURISDICTION WHERE SUCH
RELEASE, PUBLICATION OR DISTRIBUTION IS UNLAWFUL
April 28, 2022
Amsterdam, The Netherlands – Koninklijke Philips N.V.
(“Royal Philips” or the “Company”) today commenced a
tender offer (the “Offer”) to purchase for cash any and all
of its outstanding 71/8% Series A Debentures due 2025, 73/4% Series
B Debentures due 2025 and 7.200% Notes due 2026 (collectively, the
“Notes”), as set forth in the table below.
Title of Notes |
Security Identifier(s) |
PrincipalAmount Outstanding |
Reference U.S.Treasury Security |
Fixed Spread |
Bloomberg Reference Page |
AmountSubject to Offer |
71/8% Series A
Debentures due 2025 |
CUSIP: 718337AB4
ISIN: US718337AB40 |
$84,169,000 |
2.625% U.S.Treasury due April 15, 2025 |
70 bps |
FIT1 |
Any and all |
73/4% Series B
Debentures due 2025 |
CUSIP: 718337AC2
ISIN: US718337AC23 |
$63,285,000 |
2.625% U.S.Treasury due April 15, 2025 |
70 bps |
FIT1 |
Any and all |
7.200% Notesdue
2026 |
CUSIP: 718337AE8
ISIN: US718337AE88 |
$136,515,000 |
2.50% U.S.Treasury due March 31, 2027 |
75 bps |
FIT1 |
Any and all |
The Offer is being made in accordance with the terms and
subject to the conditions set forth in the Offer to Purchase, dated
April 28, 2022 (the “Offer to Purchase”) and the related
Notice of Guaranteed Delivery. The Offer will expire at 5:00 p.m.,
New York City time, on May 5, 2022, unless extended with respect to
any or all series of Notes (such date and time, as the same may be
extended, the “Expiration Time”). Tendered Notes may be
withdrawn at any time at or before 5:00 p.m., New York City time,
on May 5, 2022, unless extended with respect to any or all series
of Notes (such date and time, as the same may be extended, the
“Withdrawal Deadline”), but not thereafter. Subject to
applicable law, the Company expressly reserves the right to
terminate, in its sole discretion, the Offer at any time at or
before the Expiration Time.In connection with the commencement of
the Offer, on the date of the Offer to Purchase the Company also
announced:
- the intention to issue one or more series of new notes of the
Company denominated in euros (the “New Euro Notes”) under
the Company’s EUR10,000,000,000 Euro Medium Term Note Programme
(the “New Euro Notes Issuance”);
- the invitation by the Company to holders to tender for purchase
(a) any and all of its outstanding EUR 500,000,000 0.500 per cent.
notes due 2023 (ISIN: XS1671760384) (the “2023 Euro Notes”),
(b) any and all of its outstanding EUR 500,000,000 0.750 per cent.
notes due 2024 (ISIN: XS1815116568) (the “2024 Euro Notes”)
and (c) a capped amount of its outstanding EUR 500,000,000 1.375
per cent. notes due in 2025 (ISIN: XS2149368529) (the “2025 Euro
Notes,” together with the 2023 EUR Notes and the 2024 EUR
Notes, the “Existing Euro Notes”) (the “Euro Tender
Offer”), which is subject to the Financing Condition (as
defined below);
- the intention to pursue a proposed make-whole redemption by the
Company of any of the 2023 Euro Notes and 2024 Euro Notes that are
not purchased in the Euro Tender Offer at their make-whole
redemption amount in accordance with their terms and conditions
(the “Euro Make-Whole Redemptions”), which is subject to the
Financing Condition; and
- the proposed agreement with the relevant counterparties for
early settlement by the Company of the outstanding forward
contracts entered into in the third quarter of 2021 under the share
buyback program for capital reduction purposes announced by the
Company on July 26, 2021 (the “Early Forward Settlement”),
which is subject to the Financing Condition. The acquisition of
19,571,218 shares through the settlement of these forward contracts
would result in the early completion of the repurchase program. The
Company would then expect to cancel a total of approximately 28.3
million shares (including shares acquired through open market
purchases in December 2021 and January 2022 under the
aforementioned share buyback program) in the course of 2022,
representing 3.3% of the Company’s currently outstanding
shares.
Subject to the Financing Condition, the Company intends to use a
portion of the net proceeds of the New Euro Notes to purchase the
Notes in the Offer, to purchase certain of its outstanding
Euro-denominated notes in the Euro Tender Offer, to make the Euro
Make-Whole Redemptions and for the Early Forward Settlement. Any
decision by the Company to redeem outstanding notes in the Euro
Make-Whole Redemptions or to complete the Early Forward Settlement
will depend on various factors at that time.The Company’s
obligations to accept for purchase, and to pay for, Notes validly
tendered and not validly withdrawn pursuant to the Offer is subject
to the satisfaction, or where available, waiver, of the Financing
Condition. “Financing Condition” shall mean the successful
completion (in the sole discretion of the Company) of the New Euro
Notes Issuance. See “The Offer—Conditions to the Offer—Financing
Condition” in the Offer to Purchase for further details. There can
be no assurance that the New Euro Notes Issuance will be
successfully completed.The information contained in this
announcement on the Euro Tender Offer and the New Euro Notes
Issuance is for informational purposes only and does not constitute
or form part of any offer or invitation to sell, or any
solicitation of an offer to purchase, any securities of the
Company. The securities offered in the New Euro Notes Issuance have
not been and will not be registered under the Securities Act of
1933, as amended (the “Securities Act”), and may not be
offered or sold in the United States absent registration or an
applicable exemption from registration requirements. Neither the
Euro Tender Offer nor the offering of the New Euro Notes is being
made and will not be made directly or indirectly in or into, or by
use of the mails of, or by any means or instrumentality (including,
without limitation, facsimile transmission, telex, telephone, email
and other forms of electronic transmission) of interstate or
foreign commerce of, or any facility of a national securities
exchange of, or to owners of Existing Euro Notes who are located or
resident in the United States or to U.S. Persons as defined in
Regulation S of the Securities Act (each a “U.S.
Person”).The applicable “Consideration” for each $1,000
principal amount of Notes validly tendered and accepted for
purchase pursuant to the Offer will be determined as described in
the Offer to Purchase in a manner intended to result in a yield to
maturity, with reference to the Settlement Date (as defined below),
equal to the sum of (i) the applicable fixed spread (the “Fixed
Spread”) specified in the table above for such Notes and (ii)
the yield (the “Reference Yield”) based on the bid-side
price of the applicable U.S. Treasury Security specified in the
table above for such Notes, as determined by BofA Securities Europe
SA and Mizuho Securities USA LLC (the “Dealer Managers”) at
10:00 a.m., New York City time, on May 5, 2022 (such date and time,
as the same may be extended, the “Price Determination
Time”). The formula for determining the applicable Total
Consideration is set forth on Schedule A to the Offer to
Purchase.Holders of Notes validly tendered and not validly
withdrawn at or before the Expiration Time and accepted for
purchase will receive the applicable Consideration for such Notes.
The date of payment for such Notes is referred to as the
“Settlement Date.” The Settlement Date is expected to be on
May 10, 2022, the third business day following the Price
Determination Time. No tenders will be valid if submitted after the
Expiration Time.Any holder desiring to tender Notes should (a)
tender through DTC pursuant to DTC’s Automated Offer Program
(“ATOP”) or (b) request the holder’s broker, dealer,
commercial bank, trust company or other nominee to effect the
transaction (each, a “Tender Instruction”). If any holder
wishes to tender its Notes but such holder either cannot comply
with the applicable procedures for the submission of a valid Tender
Instruction (including the transfer of book-entry interests in the
relevant Notes) or time will not permit such Notes to be tendered
on or prior to the Expiration Time, such holder may tender its
Notes according to the guaranteed delivery procedures described in
the Offer to Purchase (the “Guaranteed Delivery
Procedures”).In addition to the applicable Consideration,
holders of Notes validly tendered and not validly withdrawn and
which are accepted for purchase in the Offer will also be paid
accrued and unpaid interest (rounded to the nearest cent) from the
last interest payment date for such Notes to, but not including,
the Settlement Date (“Accrued Interest”).The Offer is not
conditioned upon any minimum principal amount of Notes of any
series being tendered. However, the Company’s obligations to accept
for purchase, and to pay for, Notes validly tendered and not
validly withdrawn pursuant to the Offer is subject to, and
conditioned upon, the satisfaction of or, where available, the
Company’s waiver of, the conditions set forth in the Offer to
Purchase under “The Offer—Conditions to the Offer”, including the
Financing Condition.This release is qualified in its entirety by
the Offer to Purchase and the related Notice of Guaranteed
Delivery.The Company has retained BofA Securities Europe SA and
Mizuho Securities USA LLC as Dealer Managers in connection with the
Offer. Kroll Issuer Services Limited is the Tender and Information
Agent (the “Tender and Information Agent”). For additional
information regarding the terms of the Offer, please contact: BofA
Securities by telephone at +1 (980) 387-3907 (US), +1 (888)
292-0070 (U.S. Toll Free) or +33 1 877 01057 (Europe) or by email
at DG.LM-EMEA@bofa.com or Mizuho Securities by telephone at +1 212
205-7736 (Collect), +1 866 271-7403 (U.S. Toll Free) or +44 20 7090
6134 (In London) or by email at
LiabilityManagement@uk.mizuhosc.com.Any questions or requests for
assistance or for additional copies of the Offer to Purchase or the
Notice of Guaranteed Delivery and any amendments or supplements to
the foregoing may be directed to the Tender and Information Agent
by telephone at +44 20 7704 0880 or by email at
philips@is.kroll.com, or to any of the Dealer Managers at their
respective telephone numbers or email addresses above. These
documents regarding the Offer are also available at
https://deals.is.kroll.com/philips.
For further information, please contact:
Ben ZwirsPhilips Global Press Office Tel.: +31 6 1521
3446E-mail: ben.zwirs@philips.comDerya GuzelPhilips Investor
Relations Tel.: +31 20 5977055E-mail: derya.guzel@philips.com
About Royal Philips
Royal Philips (NYSE: PHG, AEX: PHIA) is a leading health
technology company focused on improving people's health and
well-being, and enabling better outcomes across the health
continuum – from healthy living and prevention, to diagnosis,
treatment and home care. Philips leverages advanced technology and
deep clinical and consumer insights to deliver integrated
solutions. Headquartered in the Netherlands, the company is a
leader in diagnostic imaging, image-guided therapy, patient
monitoring and health informatics, as well as in consumer
health and home care. Philips generated 2021 sales of EUR 17.2
billion and employs approximately 78,000 employees with sales and
services in more than 100 countries. News about Philips can be
found at www.philips.com/newscenter.
Forward-Looking StatementsThis release contains certain
“forward-looking statements” with respect to the Company.
Forward-looking statements can be identified generally as those
containing words such as “anticipates”, “assumes”, “believes”,
“estimates”, “expects”, “should”, “will”, “will likely result”,
“forecast”, “outlook”, “projects”, “may” or similar expressions. By
their nature, forward-looking statements involve risk and
uncertainty, because they relate to events that depend on
circumstances that will occur in the future. There are a number of
factors that could cause actual results and developments to differ
materially from those expressed or implied by these forward-looking
statements. These factors include, but are not limited to: the
Company’s ability to gain leadership in health informatics in
response to developments in the health technology industry; the
Company’s ability to transform its business model to health
technology solutions and services; macroeconomic and geopolitical
changes; the Company’s integration of acquisitions and their
delivery on business plans and value creation expectations;
securing and maintaining the Company’s intellectual property
rights, and unauthorized use of third-party intellectual property
rights; ability to meet expectations with respect to ESG-related
matters; failure of products and services to meet quality or
security standards, adversely affecting patient safety and customer
operations; breach of cybersecurity; ability to execute and deliver
on programs on business transformation and IT system changes and
continuity; the effectiveness of the Company’s supply chain;
attracting and retaining personnel; COVID-19 and other pandemics;
challenges to drive operational excellence and speed in bringing
innovations to market; compliance with regulations and standards
including quality, product safety and (cyber) security; compliance
with business conduct rules and regulations; treasury and financing
risks; tax risks; and reliability of internal controls, financial
reporting and management process. As a result, the Company’s actual
future results may differ materially from the plans, goals and
expectations set forth in such forward-looking statements. In view
of such uncertainties, you are cautioned not to place undue
reliance on these forward-looking statements. The Company
undertakes no obligation to publicly update any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by applicable law. See “9.2 Risk
factors” in the Company’s Annual Report on Form 20-F for the year
ended December 31, 2021 for a discussion of certain risks relating
to the business of the Company.
Important InformationThis release shall not constitute an
offer to sell, a solicitation to buy or an offer to purchase or
sell any securities. The Offer is being made only pursuant to the
Offer to Purchase and only in such jurisdictions as is permitted
under applicable law. The distribution of the Offer to Purchase in
certain jurisdictions may be restricted by law. Persons who come
into possession of the Offer to Purchase or any related documents
are required by each of the Company, the Dealer Managers and the
Tender and Information Agent to inform themselves about and to
observe any such restrictions.The Offer to Purchase and the related
Notice of Guaranteed Delivery contain important information that
holders are urged to read carefully before making any decision with
respect to the Offer. None of the Company, its statutory board,
executive committee or supervisory board, the Tender and
Information Agent, any of the Dealer Managers or any trustee for
the Notes is making any recommendation as to whether holders should
tender all or any portion of their Notes in response to the Offer.
Holders must make their own decisions as to whether to tender, or
refrain from tendering, their Notes, and the principal amount of
Notes to tender, if any. Holders should consult their tax,
accounting, financial and legal advisers regarding the tax,
accounting, financial and legal consequences of participating or
refraining from participating in the Offer.
***
United Kingdom
The communication of the Offer to Purchase and any other
documents or materials relating to the Offer is not being made, and
such documents and/or materials have not been approved, by an
authorized person for the purposes of section 21 of the Financial
Services and Markets Act 2000, as amended. Accordingly, the Offer
to Purchase and such documents and/or materials are not being
distributed to, and must not be passed on to, the general public in
the United Kingdom. The communication of the Offer to Purchase and
such documents and/or materials as a financial promotion is only
being directed at and made to (i) those persons in the United
Kingdom falling within the definition of “investment
professionals” (as defined in Article 19(5) of the Financial
Services and Markets Act 2000 (Financial Promotion) Order 2005, as
amended (the “Financial Promotion Order”)), (ii) those
persons who are existing members or creditors of the Company and
other persons falling within Article 43(2) of the Financial
Promotion Order, (iii) persons who are outside the United Kingdom
and (iv) any other persons to whom it may otherwise lawfully be
communicated (all such persons together being referred to as
“relevant persons”). Any person in the United Kingdom who is
not a relevant person should not act or rely on the Offer to
Purchase or such documents and/or materials or any of their
content. Any investment or investment activity to which the Offer
to Purchase or such other documents or materials relate is
available only to and will be engaged in only with relevant
persons.
BelgiumNeither the Offer to Purchase nor any other
documents or materials relating to the Offer have been submitted to
or will be submitted for approval or recognition to the Financial
Services and Markets Authority (Autorité des services et marchés
financiers/Autoriteit voor financiële diensten en markten) and,
accordingly, the Offer may not be made in Belgium by way of a
public offering, as defined in Articles 3 and 6 of the Belgian Law
of April 1, 2007 on public takeover bids as amended or replaced
from time to time. Accordingly, the Offer may not be advertised and
the Offer will not be extended, and neither the Offer to Purchase
nor any other documents or materials relating to the Offer
(including any memorandum, information circular, brochure or any
similar documents) has been or shall be distributed or made
available, directly or indirectly, to any person in Belgium other
than a “qualified investor” (investisseur
qualifié/gekwalificeerde belegger) as defined in Article 10 of the
Belgian Law of June 16, 2006 on the public offer of placement
instruments and the admission to trading of placement instruments
on regulated markets, acting for its own account. The Offer to
Purchase has been issued only for the personal use of the above
qualified investors and exclusively for the purpose of the Offer.
Accordingly, the information contained in the Offer to Purchase may
not be used for any other purpose or disclosed to any other person
in Belgium.
FranceThe Offer is not being made, directly or
indirectly, to the public in France. Neither the Offer to Purchase
nor any other documents or offering materials relating to the
Offer, has been or shall be distributed to the public in France and
only (i) providers of investment services relating to portfolio
management for the account of third parties (personnes fournissant
le service d’investissement de gestion de portefeuille pour compte
de tiers) and/or (ii) qualified investors (investisseurs
qualifiés), other than individuals, acting for their own account,
all as defined in, and in accordance with, Articles L.411-1,
L.411-2, D.411-1, D.744-1, D.754-1 and D.764-1 of the French Code
monétaire et financier, are eligible to participate in the Offer.
The Offer to Purchase has not been and will not be submitted for
clearance procedures (visa) of the Autorité des marchés
financiers.
ItalyNone of the Offer, the Offer to Purchase or any
other documents or materials relating to the Offer has been or will
be submitted to the clearance procedure of the Commissione
Nazionale per le Società e la Borsa (“CONSOB”), pursuant to
applicable Italian laws and regulations.The Offer is being carried
out in Italy as an exempted offer pursuant to article 101-bis,
paragraph 3-bis of the Legislative Decree No. 58 of February 24,
1998, as amended (the “Financial Services Act”) and article
35-bis, paragraph 4 of CONSOB Regulation No. 11971 of May 14, 1999,
as amended (the “CONSOB Regulation”). The Offer is also
being carried out in compliance with article 35-bis, paragraph 7 of
the CONSOB Regulation.Holders or beneficial owners of the Notes
located in Italy can tender the Notes through authorized persons
(such as investment firms, banks or financial intermediaries
permitted to conduct such activities in Italy in accordance with
the Financial Services Act, CONSOB Regulation No. 16190 of October
29, 2007, as amended from time to time, and Legislative Decree No.
385 of September 1, 1993, as amended) and in compliance with
applicable laws and regulations or with requirements imposed by
CONSOB or any other Italian authority.Each intermediary must comply
with the applicable laws and regulations concerning information
duties vis-à-vis its clients in connection with the Notes or the
Offer.
The NetherlandsIn the Netherlands, the Offer will not,
directly or indirectly, be made to, or for the account of, any
person other than to qualified investors as referred to in the
Prospectus Regulation. Neither the Offer to Purchase nor any other
documentation or material relating to the Offer has been or will
submitted to the Dutch Authority for Financial Markets (de
Autoriteit Financiële Markten, the “AFM”) for approval.
Therefore, neither the Offer to Purchase nor any documentation or
material relating to the Offer qualify as an approved prospectus as
meant in the Prospectus Regulation. Accordingly, in the
Netherlands, the Offer may not be made by way of a public offer
within the meaning of the Prospectus Regulation and the Offer may
not be promoted and is not being made to, any person in the
Netherlands (with the exception of “qualified investors”
within the meaning of the Prospectus Regulation). The Offer to
Purchase and any other documentation or material relating to the
Offer (including memoranda, information circulars, brochures or
similar documents) have not been forwarded or made available to,
and are not being forwarded or made available to, directly or
indirectly, any such person. With regard to the Netherlands, the
Offer to Purchase has been transmitted only for personal use by the
aforementioned qualified investors and only for the purpose of the
Offer. Accordingly, the information contained in the Offer to
Purchase may not be used for any other purpose or be transmitted to
any other person in the Netherlands.
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