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Albertsons Companies Announces Tender Offers for up to $500 Million of Senior Notes of New Albertson’s, Inc. and Safeway Inc.

Melissa Plaisance

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Jun 5th, 2017

 

Media Contact:

Melissa Plaisance – melissa.plaisance@albertsons.com | 925-226-5115

June 5, 2017 – Boise, ID—Albertsons Companies, LLC (the “Company”) today announced that its wholly-owned subsidiaries New Albertson’s, Inc. (“NAI”) and Safeway Inc. (“Safeway” and, together with NAI, “we,” “us” or the “Offerors”), have commenced separate tender offers to purchase (each offer a “Tender Offer” and collectively, the “Tender Offers”) for cash, subject to certain terms and conditions, up to a total of $500,000,000 aggregate principal amount (the “Tender Cap Amount”) of the debt securities listed in the table below (together, the “Securities”).  NAI is conducting the Tender Offers solely with respect to the Securities issued by NAI and Safeway is conducting the Tender Offers solely with respect to the Securities issued by Safeway.

The following table sets forth certain terms of the Tender Offers:

   

Dollars per $1,000 Principal
Amount of Securities

Issuer Title of Security CUSIP
Number
Principal Amount
Outstanding
Acceptance
Priority Level
Tender Offer
Consideration(1)
Early Tender
Premium
Total
Consideration(1)(2)
Safeway 6.350% Notes
due 2017
786514BP3 $100,000,000 1 $977.50 $30.00 $1,007.50
NAI 8.700% Senior Debentures
due 2030
013104AH7 $225,000,000 2 $1,017.50 $30.00 $1,047.50
NAI 8.000% Senior Debentures
due 2031
013104AL8 $400,000,000 3 $992.50 $30.00 $1,022.50
NAI 6.625% Medium-Term Notes
due 2028
01310QDB8 $150,000,000 4 $917.50 $30.00 $947.50
NAI 7.450% Senior Debentures
due 2029
013104AF1 $650,000,000 5 $980.00 $30.00 $1,010.00
NAI 7.750% Debentures
due 2026
013104AC8 $200,000,000 6 $998.75 $30.00 $1,028.75
Safeway 7.250% Debentures
due 2031
786514BA6 $600,000,000 7 $975.00 $30.00 $1,005.00
Safeway 7.450% Senior Debentures
due 2027
786514AS8 $150,000,000 8 $995.00 $30.00

$1,025.00

(1)            Excludes accrued and unpaid interest up to, but not including, the applicable Settlement Date (as defined below), which will be paid in addition to the Tender Offer Consideration or Total Consideration, as applicable.

(2)            Includes the Early Tender Premium.                                                                                                                                       

The Tender Offers are scheduled to expire at 11:59 p.m., New York City time, on July 5, 2017 (the “Expiration Date”), unless extended or earlier terminated by the Offerors.  The Tender Offers are being made pursuant to an Offer to Purchase dated June 5, 2017 and a related Letter of Transmittal dated June 5, 2017 (together, the “Tender Offer Materials”), which set forth a more detailed description of the Tender Offers.  Holders of the Securities are urged to carefully read the Tender Offer Materials before making any decision with respect to the Tender Offers.

The aggregate principal amount of the Securities that may be purchased pursuant to the Tender Offers will not exceed Tender Cap Amount.  Subject to the Tender Cap Amount, the aggregate principal amount of any series of Securities that is purchased in a Tender Offer will be based on the acceptance priority level for such series, as set forth in the table above (the “Acceptance Priority Level”).  As discussed in more detail in the Tender Offer Materials, the Offerors reserve the right, but are under no obligation, to increase or decrease the Tender Cap Amount, at any time, subject to compliance with applicable law.

The total consideration (the “Total Consideration”) payable for each $1,000 principal amount of Securities validly tendered at or prior to 5:00 p.m., New York City Time, on June 16, 2017 (such date and time, as it may be extended, the “Early Tender Date”) and accepted for purchase pursuant to the Tender Offers will be the applicable Total Consideration for such series of Securities set forth in the table above under the heading “Total Consideration.”  The Total Consideration includes the early tender premium for such series of Securities also set forth in the table above (the “Early Tender Premium”).  Holders must validly tender and not subsequently validly withdraw their Securities at or prior to the Early Tender Date in order to be eligible to receive the Total Consideration for such Securities purchased in the Tender Offers.

The amounts of each series of Securities that are purchased in the Tender Offer will be determined in accordance with the Acceptance Priority Levels set forth in the Offer to Purchase and referenced in the table above, with 1 being the highest Acceptance Priority Level and 8 being the lowest Acceptance Priority Level.  At the applicable Settlement Date (as defined below), all Securities validly tendered and not validly withdrawn in the Tender Offer having a higher (i.e., lower numerical) Acceptance Priority Level will be accepted before any tendered Securities having a lower (i.e., higher numerical) Acceptance Priority Level are accepted in the Tender Offer.

If the aggregate principal amount of any Securities of a series tendered and not validly withdrawn in a Tender Offer exceeds the amount of the Tender Cap Amount remaining available for application to such Tender Offer after making allowance for all Securities purchased in a higher (i.e., lower numerical) Acceptance Priority Level, then, if any Securities of such series are purchased in such Tender Offer, the Offerors will accept such Securities on a pro rata basis (rounded down to the nearest $1,000 increment).  In the event that Securities with a certain Acceptance Priority Level are accepted on such a pro rata basis, no series of Securities with a lower (i.e., higher numerical) Acceptance Priority Level will be accepted for payment.

Subject to the terms and conditions of the Tender Offers, each Holder who validly tenders and does not subsequently validly withdraw its Securities at or prior to the Early Tender Date will be entitled to receive the Total Consideration, plus accrued and unpaid interest up to, but not including, the applicable Settlement Date if and when such Securities are accepted for payment.  Holders who validly tender their Securities after the Early Tender Date but at or prior to the Expiration Date will be entitled to receive the tender offer consideration equal to the applicable Total Consideration less the Early Tender Premium (the “Tender Offer Consideration”), plus accrued and unpaid interest up to, but not including, the applicable Settlement Date, if and when such Securities are accepted for payment.

The Offerors reserve the right but are under no obligation, at any point following the Early Tender Date and before the Expiration Date, to accept for purchase any Securities validly tendered at or prior to the Early Tender Date (the “Early Settlement Date”).  The Early Settlement Date will be determined at the Offerors’ option and is currently expected to occur on or about June 22, 2017, assuming all conditions to the Tender Offers have been satisfied or waived.

Irrespective of whether the Offerors’ choose to exercise their option to have an Early Settlement Date, the Offerors will purchase any remaining Securities that have been validly tendered by the Expiration Date and that they choose to accept for purchase, subject to the Tender Cap Amount, the application of the Acceptance Priority Levels and all conditions to the Tender Offers having been satisfied or waived on a date immediately following the Expiration Date (the “Final Settlement Date and each of the Early Settlement Date and the Final Settlement Date, a “Settlement Date”).  The Final Settlement Date is expected to occur promptly after the Expiration Date for the Tender Offer and is currently expected to occur on July 6, 2017, unless extended by the Offerors, assuming all conditions to the Tender Offers have been satisfied or waived.

If the Tender Offers are not fully subscribed to the Tender Cap Amount as of the Early Tender Date and the Offerors elect to have an Early Settlement Date, Holders who validly tender Securities after the Early Tender Date may be subject to proration, whereas Holders who validly tender Securities at or prior to the Early Tender Date will not be subject to proration.  In addition, if the aggregate principal amount of Securities of all series validly tendered in the Tender Offers at or prior to the Early Tender Date exceeds the Tender Cap Amount and the Offerors elect to have an Early Settlement Date, Securities tendered after the Early Tender Date will not be eligible for purchase regardless of the Acceptance Priority Level of such Securities, unless the Tender Cap Amount is increased.

However, in the event the Offerors do not elect to have an Early Settlement Date and the applicable Tender Offer is fully subscribed, or the aggregate principal amount of Securities of all series validly tendered at or prior to the Expiration Date exceeds the Tender Cap Amount, as applicable, all Holders who validly tendered Securities will be subject to proration, subject to the application of the Acceptance Priority Levels.  Securities which were not accepted for purchase due to the Tender Cap Amount or the application of the Acceptance Priority Levels may be accepted if the Offerors increase the Tender Cap Amount, which the Offerors are entitled to do at their sole discretion, and such increase is not fully used up by Securities validly tendered at or prior to the Early Tender Date (in the event the Offerors elect to have an Early Settlement Date) or by Securities purchased in a higher (i.e., lower numerical) Acceptance Priority Level.  There can be no assurance that the Offerors will increase the Tender Cap Amount.

The obligation of the Offerors to accept for purchase and to pay either the Total Consideration or Tender Offer Consideration and the accrued and unpaid interest on the tendered Securities pursuant to the Tender Offers is not subject to any minimum tender condition, but is subject to the Tender Cap Amount, the application of the Acceptance Priority Levels, the Offerors’ receipt of net proceeds of new debt financing, including a potential offering of senior guaranteed notes, on terms and conditions satisfactory to the Offerors and certain other conditions described in the Tender Offer Materials.

The Offerors have retained BofA Merrill Lynch to serve as Dealer Manager for the Tender Offers. Global Bondholder Services Corporation has been retained to serve as the Information Agent and Tender Agent for the Tender Offers.  Questions regarding the Tender Offers may be directed to BofA Merrill Lynch at (980) 388-3646 (collect) or (888) 292-0070 (toll-free).  Requests for the Tender Offer Materials may be directed to Global Bondholder Services Corporation at 65 Broadway – Suite 404, New York, New York, 10006, Attn: Corporate Actions, (212) 430-3774 (for banks and brokers) or (866)-794-2200 (for all others).

The Offerors are making the Tender Offers only by, and pursuant to, the terms of the Tender Offer Materials. None of the Company, the Offerors, the Dealer Manager, the Information Agent or the Tender Agent make any recommendation as to whether Holders should tender or refrain from tendering their Securities. Holders must make their own decision as to whether to tender Securities and, if so, the principal amount of the Securities to tender.  The Tender Offers are not being made to holders of Securities in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction.  In any jurisdiction in which the securities laws or blue sky laws require the Tender Offers to be made by a licensed broker or dealer, the Tender Offers will be deemed to be made on behalf of the Offerors by the Dealer Manager, or one or more registered brokers or dealers that are licensed under the laws of such jurisdiction.

This press release does not constitute an offer to purchase securities or a solicitation of an offer to sell any securities or an offer to sell or the solicitation of an offer to purchase any new securities, nor does it constitute an offer or solicitation in any jurisdiction in which such offer or solicitation is unlawful.  Capitalized terms used in this press release but not otherwise defined herein have the meanings assigned to them in the Tender Offer Materials.

Cautionary Statement

This press release contains forward-looking statements. All statements other than statements of historical facts contained in this press release, including statements regarding the Company’s future operating results and financial position, business strategy, and plans and objectives of the Company’s management for future operations, are forward-looking statements. In many cases, you can identify forward-looking statements by terms such as “may,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” or “continue” or the negative of these terms or other similar expressions. You should not rely upon forward-looking statements as predictions of future events. The Company has based the forward-looking statements contained in this press release primarily on the Company’s current expectations and projections about future events and trends that it believes may affect its business, financial condition, results of operations and prospects. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors. Moreover, the Company operates in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time and it is not possible for the Company to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this press release. The Company cannot assure you that the results, events and circumstances reflected in this press release will be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.

The forward-looking statements made in this press release relate only to events as of the date on which the statements are made. The Company undertakes no obligation to update any forward-looking statements made in this press release to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law. The Company and the Offerors may not actually achieve the plans, intentions or expectations disclosed in the forward-looking statements contained in this press release and you should not place undue reliance on our forward-looking statements. The forward-looking statements made in this press release do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments the Company or the Offerors may make.

For more information on the potential factors, please see the “Special Note Regarding Forward-Looking Statements and Other Factors” section in the Offer to Purchase dated June 5, 2017.

2 Responses to Albertsons Companies Announces Tender Offers for up to $500 Million of Senior Notes of New Albertson’s, Inc. and Safeway Inc.

  1. john sellers 25/08/2017 at 5:31 pm

    quick reading, I did not see a date to pay if the offer is accepted? what is the expected pay date?

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