CVS begins tender offers on up to $4 billion of six series of notes

By Taylor Fox

New York, Dec. 7 – CVS Health Corp. has begun cash tender offers for up to $4 billion of notes from six series due 2023, 2025 and 2028, including one 2023 series issued by wholly owned subsidiary Aetna Inc., according to a news release.

Specifically, CVS will accept for purchase up to $1.5 billion of notes from three series due 2023, up to $1 billion of notes from two series due 2025 and up to $1.5 billion of notes from a series due 2028.

2023 note offers

CVS is offering to purchase up to $1.5 billion of the following notes, listed by acceptance priority level:

• $527,191,000 outstanding 4% senior notes due 2023 (Cusip: 126650CC2), with pricing based on the 0.25% U.S. Treasury due Nov. 15, 2023 and a fixed spread of 20 basis points;

• $3,722,809,000 outstanding 3.7% senior notes due 2023 (Cusip: 126650CV0), with pricing based on the 0.25% U.S. Treasury due Nov. 15, 2023 and a fixed spread of 20 bps; and

• $1.3 billion outstanding 2.8% senior notes due 2023 (Cusip: 00817YAV0) issued by Aetna, with pricing based on the 0.25% U.S. Treasury due Nov. 15, 2023 and a fixed spread of 28 bps.

2025 note offers

CVS is offering to purchase up to $1 billion of the following notes, listed by acceptance priority level:

• $2,000,006,000 outstanding 4.1% senior notes due 2025 (Cusip: 126650CW8), with pricing based on the 0.375% U.S. Treasury due Nov. 30, 2025 and a fixed spread of 34 bps; and

• $2,828,067,000 outstanding 3.875% senior notes due 2025 (Cusip: 126650CL2), with pricing based on the with pricing based on the 0.375% U.S. Treasury due Nov. 30, 2025 and a fixed spread of 38 bps.

2028 note offer

CVS is offering to purchase up to $1.5 billion of its $9 billion outstanding 4.3% senior notes due 2028 (Cusip: 126650CX6), with pricing based on the 0.875% U.S. Treasury due Nov. 15, 2030 and a fixed spread of 57 bps.

The total consideration will be determined at 9 a.m. ET Dec. 21.

Holders who tender notes by the 5 p.m. ET Dec. 18 early tender deadline will be eligible to receive the total consideration, which includes an early tender payment of $30 per $1,000 of notes.

CVS will also pay interest.

The early settlement date is expected to be Dec. 22.

The offer will expire at 11:59 p.m. ET Jan. 5.

The final settlement date is expected to be Jan. 7.

The issuer said it reserves the right to adjust the overall tender cap as well as the tender sub-caps. Reallocation of maximum amounts under the offers and proration may apply if the caps are exceeded.

The offers are not conditioned on any minimum principal amount being tendered but are subject to a financing condition.

The purpose of the tender offers is to refinance a portion of CVS Health’s debt and to lower its overall indebtedness.

Barclays (800 438-3242, 212 528-7581), BofA Securities, Inc. (980 387-3907) and Goldman Sachs & Co. LLC (212 902-6351) are the dealer managers.

D.F. King & Co., Inc. (212 269-5550, 800 714-3305 cvs@dfking.com) is the tender and information agent.

The health care company is based in Woonsocket, R.I.

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