Citycon launches separate tender offers for its euro, krone notes

By Sarah Lizee

Olympia, Wash., Nov. 7 – Citycon Oyj launched an offer to purchase any and all of its €500 million 3.75% notes due 2020 and to purchase a capped amount of the €300 million 2.375% guaranteed notes due 2022 and the €350 million 2.5% guaranteed notes due 2024 of Citycon Treasury BV, according to a notice.

The offer will expire at 11 a.m. on Nov. 15.

Specifically, the company is tendering for the following series:

• Any and all of the €218,674,000 3.75% notes due 2020, with pricing to be set using a purchase yield of negative 0.2% for a purchase price of 102.336;

• A capped amount of the €300 million 2.375% guaranteed notes due 2022, with pricing to be set using the interpolated mid-swap rate plus 65 basis points; and

• A capped amount of the €350 million 2.5% guaranteed notes due 2024, with pricing to be set using the interpolated mid-swap rate plus 140 bps.

Should the settlement date change, the purchase price for the 3.75% notes will be recalculated.

Citycon said it will first accept any and all of the tendered 2020 notes, and, if the total amount payable for the 2020 notes is less than €250 million, accept a capped amount of tendered 2022 and 2024 notes.

The cap will be no greater than €250 million less the total amount payable for the 2020 notes accepted for purchase.

The offeror said it will determine the allocation of the offer cap between the 2022 and 2024 notes.

The company said the purpose of the tender and new issue is to reduce its leverage and optimize its capital structure.

Tendered 2022 and 2024 notes accepted for purchase will be subject to proration.

Pricing will be set at 8 a.m. ET on Nov. 18. Settlement is scheduled for Nov. 21.

The offer is subject to a financing condition. Citycon said it expects to issue on or before Nov. 21 new €400 million subordinated fixed- to reset-rate capital securities.

The net proceeds of the new notes will be used, among other things, to purchase notes under the tender offer.

Danske Bank A/S (+45 33 64 88 51, liabilitymanagement@danskebank.dk) and UBS Europe SE (+44 20 7568 1121, ol-liabilitymanagement-eu@ubs.com) are the dealer managers.

Lucid Issuer Services Ltd. (+44 20 7704 0880, citycon@lucid-is.com) is the tender agent.

Separate Dutch tender

Citycon also launched a separate conditional tender for up to NOK 900 million of its NOK 1.25 billion bonds due March 1, 2021 issued by Citycon Treasury.

The tender offer process will be conducted as a reverse Dutch auction, where the offeror through the arranger, Danske Bank, will receive offers from the bondholders on a confidential basis for sales of desired volumes at desired prices to the offeror.

All bondholders are invited and are eligible to provide offers for sale of all or a portion of their bonds.

The deadline to submit offers is 11 a.m. ET on Nov. 15.

The offeror will decide on a purchase price and total acceptance amount before 4 a.m. ET on Nov. 18.

Settlement is expected for Nov. 21.

Citycon is a Helsinki, Finland-based property investment company with a focus on retail centers.

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