Santander begins tender offer for 8.75% subordinated notes due 2018

By Marisa Wong

Morgantown, W.Va., Oct. 11 – Santander Holdings USA, Inc.’s wholly owned subsidiary, Santander Bank, NA, said it has begun a cash tender offer for any and all of its $500 million outstanding 8.75% subordinated notes due 2018.

The offer will expire at 5 p.m. ET on Oct. 17.

The purchase price for each $1,000 principal amount of notes tendered accepted for purchase will be determined using a fixed spread of 25 basis points plus the yield based on the bid-side price of the 1% U.S. Treasury due May 31, 2018. Pricing will be set at 11 a.m. ET on Oct. 17.

Tenders may be withdrawn at any time before the expiration of the offer. If the offer is extended, the withdrawal deadline will be the 10th business day after the start of the offer.

Payment for notes accepted for purchase is expected to be made on Oct. 18. The issuer said payment for notes delivered under guaranteed delivery procedures will occur on Oct. 20.

The bank is making the offer in order to retire all or a portion of the notes prior to their maturity and will use cash on hand to fund the purchases.

The offer is not conditioned on the tender of any minimum principal amount of notes.

Barclays (800 438-3242 or 212 528-7581) is the dealer manager for the offer. D.F. King & Co., Inc. (212 269-5550 for banks and brokers or 800 814-2879) is the tender agent and information agent.

Boston-based Santander Holdings USA is a wholly owned subsidiary of Madrid-based Banco Santander, SA.

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