Karlsberg to end exchange offer early due to high demand, sets interest at 6%

By Mary-Katherine Stinson

Lexington, Ky., April 16 – Karlsberg Brauerei GmbH announced modifications to its public exchange offer for its existing corporate bond 2020/2025 (ISIN: DE000A254UR5) with a nominal value of €50 million, according to a company notice.

Karlsberg said that due to “high demand” both the exchange period and the subscription period will be shortened.

The exchange period, which began on April 5, will now end at noon p.m. ET on April 18. It was originally scheduled to end at noon p.m. ET on April 22.

During this period, holders may exchange their existing bonds on a 1:1 basis for the new bonds, a cash settlement of €10.00 and accrued interest, as previously reported.

The subscription period for the new bonds will now expire at 3 a.m. ET on April 19. It was originally set to end at 6 a.m. ET on April 25.

Additionally, the interest rate for the new bond 2024/2029 has been fixed at the lower end of the range at 6%. Price talk was between 6% and 7%, with the final rate to be determined at the end of the original offer period on April 25.

As previously reported, the company launched a public exchange offer for its existing corporate bond 2020/2025 in connection with a planned new corporate bond issue, bond 2024/2029 (ISIN: NO0013168005).

The prospectus was approved by the Luxembourg Financial Market Authority Commission de Surveillance du Secteur Financier, on April 3.

The bonds will be sold as a public offering in Germany and Luxembourg and as a private placement also in Germany, selected European countries and certain other countries.

Pareto Securities AS, Frankfurt Branch, is acting as the lead manager for the private placement.

The company will use the proceeds to call any of the remaining €50 million 2020/2025 bonds ISIN: DE000A254UR5) not tendered in the offer at a redemption price of 101 within three business days of the issuance of the new bonds and by June 6 at the latest.

The 2020/2025 bonds have been callable at 101 since Sept. 30.

Existing bondholders are being given the opportunity exchange those notes for the new notes.

Accordingly, the listing date of the new bonds on the Frankfurt Stock Exchange has been adjusted to May 2. The listing for the bonds on the Nordic ABM of the Oslo Stock Exchange is expected within six months of the issue date.

The brewery is based in Homburg, Germany.

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