Valero Energy Announces Pricing Terms of its Pending Maximum Tender Offer

Source: www.gulfoilandgas.com 12/3/2021, Location: North America

Valero Energy Corporation announced the pricing terms of its previously announced cash tender offer (the “Maximum Tender Offer”) for up to an increased maximum aggregate purchase price which, after giving effect to the elimination of the Series Tender Cap (as defined in the Offer to Purchase dated November 18, 2021 (the “Offer to Purchase”)) for the 2024 Notes (as defined below), is sufficient to purchase all of the 2039 Notes (as defined below) validly tendered and not validly withdrawn at or prior to the Early Tender Date (as defined below) (such increased maximum aggregate purchase price, the “Maximum Aggregate Purchase Price”) of its outstanding 1.200% Senior Notes due 2024 (the “2024 Notes”), its outstanding 3.650% Senior Notes due 2025 (the “3.650% 2025 Notes”), its outstanding 2.850% Senior Notes due 2025 (the “2.850% 2025 Notes”), its outstanding 10.500% Senior Notes due 2039 (the “2039 Notes”), its outstanding 8.750% Senior Notes due 2030 (the “2030 Notes”), its outstanding 7.500% Senior Notes due 2032 (the “2032 Notes”) and its outstanding 6.625% Senior Notes due 2037 (the “2037 Notes”) and the outstanding 4.375% Senior Notes due 2026 issued by Valero Energy Partners LP and guaranteed by Valero (the “2026 Notes” and, together with the 2024 Notes, the 3.650% 2025 Notes, the 2.850% 2025 Notes, the 2039 Notes, the 2030 Notes, the 2032 Notes and the 2037 Notes, the “Maximum Tender Offer Notes”). The terms and conditions of the Maximum Tender Offer are described in the Offer to Purchase.

As of 5:00 p.m., New York City time, on December 2, 2021 (the “Early Tender Date”), as reported by D.F. King & Co., Inc., the tender and information agent for the Maximum Tender Offer, the aggregate principal amount of each of the 2024 Notes, 3.650% 2025 Notes, 2026 Notes and 2039 Notes listed in the table below had been validly tendered and not validly withdrawn. The applicable Reference Yield, Repurchase Yield, Early Tender Payment and Total Consideration (each as defined more fully in the Offer to Purchase) with respect to the 2024 Notes, 3.650% 2025 Notes, 2026 Notes and 2039 Notes accepted for purchase are detailed in the table below.

Because the aggregate principal amount of Maximum Tender Offer Notes validly tendered and not validly withdrawn at or prior to the Early Tender Date has an aggregate purchase price that exceeds the Maximum Aggregate Purchase Price, Valero does not expect to accept for purchase all Maximum Tender Offer Notes that have been validly tendered and not validly withdrawn at or prior to the Early Tender Date. Rather, subject to the Maximum Aggregate Purchase Price, the Series Tender Cap (as defined in the Offer to Purchase) applicable to the 3.650% 2025 Notes, 2026 Notes and 2.850% 2025 Notes, and the acceptance priority levels set forth in the table above, in each case as further described in the Offer to Purchase, Valero will accept for purchase 2024 Notes, 3.650% 2025 Notes, 2026 Notes and 2039 Notes validly tendered and not validly withdrawn at or prior to the Early Tender Date and does not expect to accept for purchase any 2.850% 2025 Notes, 2030 Notes, 2032 Notes or 2037 Notes. As a result, a holder who validly tenders and does not validly withdraw Maximum Tender Offer Notes pursuant to the Maximum Tender Offer may have all or a portion of its Maximum Tender Offer Notes returned to it.

On the Maximum Tender Early Settlement Date (as defined below), Valero will pay the Total Consideration (as shown in the table above for the 2024 Notes, 3.650% 2025 Notes, 2026 Notes and 2039 Notes) for each $1,000 principal amount of each of the 2024 Notes, 3.650% 2025 Notes, 2026 Notes and 2039 Notes validly tendered and not validly withdrawn at or prior to the Early Tender Date and accepted for purchase. The Total Consideration was calculated in the manner described in the Offer to Purchase by reference to the applicable fixed spread specified in the table above plus the applicable yield to maturity based on the bid-side price of the applicable U.S. Treasury Reference Security specified in the table above at 10:00 a.m., New York City time, on December 3, 2021. The Total Consideration also includes the Early Tender Payment (as shown in the table above for the 2024 Notes, 3.650% 2025 Notes, 2026 Notes, and 2039 Notes) for each $1,000 principal amount of each of the 2024 Notes, 3.650% 2025 Notes, 2026 Notes, and 2039 Notes validly tendered and not validly withdrawn at or prior to the Early Tender Date and accepted for purchase. Payments for the 2024 Notes, 3.650% 2025 Notes, 2026 Notes and 2039 Notes accepted for purchase will include accrued and unpaid interest from the last interest payment date applicable to the relevant series of Maximum Tender Offer Notes up to, but excluding, the settlement date for Maximum Tender Offer Notes that are validly tendered and not validly withdrawn at or prior to or at the Early Tender Date and accepted for purchase (the “Maximum Tender Early Settlement Date”). It is anticipated that the Maximum Tender Early Settlement Date will be December 6, 2021, the second business day after the Early Tender Date.

The Maximum Tender Offer will expire at midnight, New York City time, at the end of December 16, 2021 (the “Maximum Tender Expiration Date”), unless extended or earlier terminated. Because the Maximum Tender Offer has been fully subscribed as of the Early Tender Date, holders who tender Maximum Tender Offer Notes after the Early Tender Date will not have any of their Maximum Tender Offer Notes accepted for purchase, unless Valero elects to increase or eliminate the Maximum Aggregate Purchase Price. Any Maximum Tender Offer Notes tendered after the Early Tender Date, together with any Maximum Tender Offer Notes tendered at or prior to the Early Tender Date but not accepted for purchase by Valero, will be returned to the holders thereof as described in the Offer to Purchase, unless Valero elects to increase or eliminate the Maximum Aggregate Purchase Price.

The withdrawal deadline for the Maximum Tender Offer was 5:00 p.m., New York City time, on December 2, 2021 and has not been extended. Accordingly, previously tendered Maximum Tender Offer Notes and Maximum Tender Offer Notes tendered after such withdrawal deadline may not be withdrawn, subject to applicable law.

Valero’s obligation to accept for payment and to pay for the Maximum Tender Offer Notes validly tendered and not validly withdrawn in the Maximum Tender Offer is subject to the satisfaction or waiver of a number of conditions described in the Offer to Purchase. The Maximum Tender Offer may be terminated or withdrawn in whole or terminated or withdrawn with respect to any series of Maximum Tender Offer Notes, subject to applicable law. Valero reserves the right, subject to applicable law, to (1) waive any and all conditions to the Maximum Tender Offer, (2) extend or terminate the Maximum Tender Offer, (3) increase, decrease or eliminate the Maximum Aggregate Purchase Price and/or any Series Tender Cap or (4) otherwise amend the Maximum Tender Offer in any respect.

Valero has retained J.P. Morgan Securities LLC and Citigroup Global Markets Inc., as Lead Dealer Managers, and BofA Securities, Inc., Mizuho Securities USA LLC and MUFG Securities Americas Inc., as Co-Dealer Managers (collectively, the “Dealer Managers”), for the Maximum Tender Offer. Valero has retained D.F. King & Co., Inc., as the tender and information agent, for the Maximum Tender Offer. For additional information regarding the terms of the Maximum Tender Offer, please contact: J.P. Morgan Securities LLC at (866) 834-4666 (toll free) or (212) 834-3424 (collect); or Citigroup Global Markets Inc. at (800) 831-9146. Requests for documents and questions regarding the tendering of securities may be directed to D.F. King & Co., Inc. by telephone at (212) 269-5550 (for banks and brokers only) or (800) 334-0384 (for all others, toll-free), by email at vlo@dfking.com or at www.dfking.com/vlo or to the Dealer Managers at their respective telephone numbers.


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