Newell Brands tallies early tenders; waterfall offer oversubscribed

By Marisa Wong

Morgantown, W.Va., Oct. 16 – Newell Brands Inc. announced it received tenders for $249,064,000 of notes under its any-and-all offer and a total of $2,259,410,000 of notes under its waterfall offer as of 5 p.m. ET on Oct. 15, the early tender deadline for the tender offers.

As announced on Oct. 1, Newell Brands is offering to purchase any and all of its $350 million of 2.875% notes due 2019 under the any-and-all offer.

In the waterfall offer, the company is offering to purchase the following three series of notes, listed in order of acceptance priority, for an aggregate purchase price of up to $650 million: $1 billion 3.15% notes due 2021, $1.75 billion 3.85% notes due 2023 and $2 billion 4.2% notes due 2026. The company will accept no more than $100 million principal amount of the 4.2% notes.

As of the early tender deadline, the company received tenders for $249,064,000 of the 2.875% notes, $737,548,000 of the 3.15% notes, $892,109,000 of the 3.85% notes and $629,753,000 of the 4.2% notes.

Because the aggregate principal amount of tendered waterfall notes exceeded the tender cap, the waterfall notes will be purchased subject to acceptance priority levels and proration.

Holders who tendered by the early tender deadline will receive the applicable total consideration, which includes an early tender premium of $30 per $1,000 principal amount of notes.

The company will also pay accrued interest up to but excluding the settlement date.

Pricing will be determined at 11 a.m. ET on Oct. 16. They will be calculated based on the yield to the applicable call or maturity date of the applicable reference security and a fixed spread.

The reference security is the 1.375% Treasury due Dec. 15, 2019 for the 2.875% notes, the 2.75% Treasury due Sept. 15, 2021 for the 3.15% notes, the 2.875% Treasury due Sept. 30, 2023 for the 3.85% notes and the 2.875% Treasury due Aug. 15, 2028 for the 4.2% notes.

The fixed spread is 20 basis points for the 2.875% notes, 70 bps for the 3.15% notes, 125 bps for the 3.85% notes and 190 bps for the 4.2% notes.

Had the waterfall offer not been fully subscribed as of the early tender deadline, subject to the 4.2% notes tender cap and the maximum waterfall tender amount, waterfall notes tendered by the early tender deadline would have been accepted for purchase in priority to other waterfall notes tendered following the early tender deadline even if those waterfall notes tendered following the early tender deadline were to have a higher acceptance priority level than waterfall notes tendered by the early tender deadline.

The tender offers are set to expire at midnight ET at the end of Oct. 29. However, because the waterfall offer was fully subscribed as of the early deadline, the company does not expect to accept for purchase any waterfall notes tendered after the early deadline.

The company will redeem any 2.875% notes not tendered in the offer on Nov. 9, as previously announced.

The company expects to fund the tender offers with the proceeds from recently completed divestitures under its accelerated transformation plan, together with available cash on hand.

Citigroup Global Markets Inc. (212 723-6106 or 800 558-3745) is the lead dealer manager, with Barclays and BofA Merrill Lynch as co-dealer managers. The information agent and tender agent is Global Bondholder Services Corp. (212 430-3774 or 866 807-2200).

Newell Brands is a consumer goods company based in Hoboken, N.J.

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