MONTERREY, Mexico, Feb. 16,
2023 /PRNewswire/ -- FOMENTO ECONÓMICO MEXICANO,
S.A.B. DE C.V. ("FEMSA") (NYSE: FMX; BMV: FEMSAUBD, FEMSAUB)
announced that it has commenced offers to purchase for cash (the
"Offers" and, individually, an "Offer") FEMSA's notes of the series
set forth in the table below (all such notes, the "Notes" and each
such series, a "series" of Notes), for an aggregate purchase price,
excluding Accrued Interest (as defined below) and Additional
Amounts (as defined below), if any (the "Aggregate Purchase
Price"), of up to US$2.0 billion (the
"Tender Cap"), subject to the acceptance priority procedures and
proration described herein from each registered holder of the Notes
(each a "Holder" and, collectively, the "Holders").
The Offers are being made pursuant to the terms and subject to
the conditions set forth in the Offer to Purchase dated
February 16, 2023 (as may be amended
or supplemented from time to time, the "Offer to Purchase"). The
series of Notes denominated in U.S. dollars are herein referred to
as the "U.S. Dollar Notes," and the series of Notes
denominated in Euros are herein referred to as the "EUR
Notes."
The following table sets forth the series of Notes subject to
the Offers:
Notes
|
CUSIP/ISIN
|
Principal Amount
Outstanding
|
Acceptance
Priority Level
|
Reference
Security/
Interpolated Mid-Swap Rate
|
Bloomberg
Reference Page
|
Fixed Spread
(basis points)(1)
|
Hypothetical
Total Consideration(2)
|
3.500% Senior Notes due
2050(3)
|
344419 AC0 /
US344419AC03
|
US$2,500,000,000
|
1
|
4.00% U.S. Treasury
Note due 11/15/52
|
PX1
|
+ 120
|
US$768.10
|
4.375% Senior Notes due
2043
|
344419 AB2 /
US344419AB20
|
US$700,000,000
|
2
|
4.00% U.S. Treasury
Note due 11/15/42
|
PX1
|
+ 120
|
US$893.00
|
0.500% Senior Notes due
2028
|
-/
XS2337285519
|
€700,000,000
|
3
|
2028 Interpolated
Mid-Swap Rate
|
IRSB EU <GO>
(Euro Zone) Page, Pricing Source: BGN
|
+ 70
|
€772.24
|
1.000% Senior Notes due
2033
|
-/
XS2337285865
|
€500,000,000
|
4
|
2033 Interpolated
Mid-Swap Rate
|
IRSB EU <GO>
(Euro Zone) Page, Pricing Source: BGN
|
+ 30
|
€863.71
|
________________________
|
(1)
|
The Total Consideration
(as defined below) payable per each US$1,000 or €1,000, as
applicable, principal amount of each series of Notes validly
tendered for purchase will be calculated in accordance with the
formulas set forth in Schedule I and Schedule II to the Offer to
Purchase, based on the fixed spread specified in the table above
for such series of Notes, plus the yield of the specified
Reference Security/ Interpolated Mid-Swap Rate for that series as
determined from the Bloomberg Reference Page specified in the table
above as of 11:00 a.m., New York City time, on March 2, 2023,
unless extended with respect to an Offer (such date and time, as
the same may be extended with respect to an Offer, the "Price
Determination Date"). The Total Consideration for each series of
Notes includes an early tender premium in the amount of US$30 per
US$1,000 or €30 per €1,000, as applicable, principal amount of
Notes validly tendered on or prior to the Early Tender Time (and
not validly withdrawn) and accepted for purchase pursuant to the
Offers (the "Early Tender Premium").
|
(2)
|
Per US$1,000 or €1,000,
as applicable, principal amount of each series of Notes validly
tendered and accepted for purchase. The hypothetical Total
Consideration provided in the above table is for illustrative
purposes only and was calculated based on the yield calculated to
the applicable maturity date or par call date, as applicable, and
has been determined as of 11:00 a.m., New York City time, on
February 15, 2023 in accordance with the formulas set forth in
Schedule I and Schedule II to the Offer to Purchase. The
hypothetical Total Consideration for each series of Notes includes
the applicable Early Tender Premium for such series. FEMSA
makes no representation with respect to the actual Total
Consideration payable in connection with the Offers, and such
amounts may be greater or less than those shown in the above table
depending on the yield of the applicable Reference Security or the
Interpolated Mid-Swap Rate on the Price Determination
Date.
|
(3)
|
The par call date for
this series of Notes is July 16, 2049.
|
The Offers will expire at 11:59
p.m., New York City time,
on March 16, 2023, unless extended or
earlier terminated with respect to an Offer (such time and date, as
the same may be extended or earlier terminated with respect to an
Offer, the "Expiration Time"). In order to be eligible to receive
the applicable Total Consideration, Holders must validly tender
(and not validly withdraw) their Notes on or prior to 2:00 a.m., New York
City time, on March 3, 2023,
unless extended with respect to an Offer (such time and date, as
the same may be extended with respect to an Offer, the "Early
Tender Time").
Tenders of Notes may be withdrawn at any time on or before
2:00 a.m., New York City time, on March 3, 2023, unless extended with respect to an
Offer, but not thereafter.
On the Price Determination Date, FEMSA will notify the tender
agent and will make a public announcement thereof to the Holders
promptly after 11:00 a.m.,
New York City time on the Price
Determination Date.
The total consideration (the "Total Consideration") offered for
each US$1,000 or €1,000, as
applicable, principal amount of each series of Notes validly
tendered (and not validly withdrawn) and accepted for purchase
pursuant to the Offers is the price (calculated as described in
Schedule I and Schedule II to the Offer to Purchase) that would
reflect:
(i) for each series of U.S. Dollar Notes,
(1) the present value on the Initial
Settlement Date (as defined below) of (x) US$1,000, representing the principal amount
payable on the scheduled maturity date or par call date of the
relevant series of U.S. Dollar Notes, as applicable, and (y) all
scheduled interest payments from the Initial Settlement Date up to
and including the scheduled maturity date or par call date of the
relevant series of U.S. Dollar Notes, as applicable, in each case
discounted on the basis of a yield equal to the sum of (a) the
yield to maturity (the "Reference Yield") of the applicable
reference security set forth in the table above in the column under
the heading "Reference Security/ Interpolated Mid-Swap Rate" (each,
a "Reference Security"), as calculated by BofA Securities, Inc. in
its capacity as Dealer Manager (as defined below) in accordance
with standard market practice, determined by reference to the
bid–side price of the Reference Security at 11:00 a.m., New York
City time, on the Price Determination Date, as displayed on
the applicable Bloomberg Reference Page specified in the table
above in the column under the heading "Bloomberg Reference Page" or
any recognized quotation source selected by the Dealer Manager in
its sole discretion if such Bloomberg Reference Page is not
available or is manifestly erroneous, plus (b) the
applicable fixed spread specified in the table above in the column
under the heading " Fixed Spread" (the "Fixed Spread"),
minus
(2) Accrued Interest to, but not including,
the Initial Settlement Date, and
(ii) for each series
of EUR Notes,
(1) the present value on the Initial
Settlement Date of (x) €1,000, representing the principal amount
payable on the scheduled maturity date of the relevant series of
EUR Notes, as applicable, and (y) all scheduled interest payments
(assuming the applicable Sustainability Performance Targets have
been satisfied by the applicable Interest Rate Step Up Date, each
as defined in the terms of the indenture under which such EUR Notes
were issued) from the Initial Settlement Date up to and including
the scheduled maturity date of the relevant series of EUR Notes, in
each case discounted on the basis of a yield equal to the sum of
(a) the Reference Yield (corresponding to the applicable
Interpolated Mid-Swap Rate) as calculated by BofA Securities, Inc.
in its capacity as Dealer Manager in accordance with standard
market practice, plus (b) the applicable Fixed Spread,
minus
(2) Accrued Interest to, but not including,
the Initial Settlement Date,
such price being rounded to the nearest US$0.01 per US$1,000 principal amount of the U.S. Dollar
Notes or €0.01 per €1,000 principal amount of the EUR
Notes.
The Total Consideration, when calculated in the manner set out
in the Offer to Purchase, includes the Early Tender
Premium.
Subject to the terms and conditions of the Offers, each Holder
who validly tenders on or prior to the Early Tender Time and does
not validly withdraw such Holder's Notes will be entitled to
receive, if such Notes are accepted for purchase (the date of such
purchase, the "Initial Settlement Date"), the applicable Total
Consideration, plus accrued and unpaid interest on the
purchased Notes (the "Accrued Interest") from and including the
last interest payment date to, but not including, the Initial
Settlement Date and additional amounts in respect of withholding
taxes applicable to the Accrued Interest (including gains derived
from the sale of the Notes in the Offers that are treated as
interest), if any (the "Additional Amounts"). Holders who validly
tender their Notes after the Early Tender Time but on or prior to
the Expiration Time will be entitled to receive, if such Notes are
accepted for purchase (the date of such purchase, the "Final
Settlement Date" and each of the Initial Settlement Date and the
Final Settlement Date, a "Settlement Date"), the applicable Total
Consideration minus the Early Tender Premium, plus
Accrued Interest to, but not including, the Final Settlement Date
and Additional Amounts, if any. Assuming all conditions to the
Offers have been satisfied or waived, the Initial Settlement Date
is expected to occur on the second business day following the Early
Tender Time, or March 7, 2023, and
the Final Settlement Date is expected to occur on the second
business day following the Expiration Time, or March 20, 2023.
The Offers are not contingent upon the valid tender of any
minimum principal amount of Notes. The consummation of the Offers
is conditioned upon satisfaction or waiver of each and all of the
conditions set forth in the Offer to Purchase, including (i) FEMSA
having consummated a borrowing under FEMSA's U.S.-dollar
denominated credit agreement to be executed on or about
February 16, 2023, with, among
others, certain lenders that include one or more affiliates of the
Dealer Manager, yielding net proceeds to FEMSA sufficient to fund,
together with available cash on hand, the Aggregate Purchase Price,
together with Accrued Interest and Additional Amounts, if any, due
to Holders of such series tendered in the applicable Offer (the
"Financing Condition") and (ii) other customary conditions.
Subject to applicable law, FEMSA reserves the right to (x) waive
any and all conditions to an Offer on or prior to the Initial
Settlement Date, without necessarily extending withdrawal rights
except as may be required by applicable law, or the Expiration
Time, (y) extend an Offer or (z) if the conditions of an Offer are
not satisfied or waived, otherwise amend or terminate such Offer in
any respect.
If the purchase of all Notes validly tendered (and not validly
withdrawn) on or prior to the Early Tender Time would cause
FEMSA to purchase an aggregate principal amount of Notes that
would result in an Aggregate Purchase Price in excess of the Tender
Cap, then the Offers will be oversubscribed at the Early Tender
Time, and FEMSA will not accept for purchase any Notes tendered
after the Early Tender Time and FEMSA will (assuming
satisfaction or, where applicable, the waiver of the conditions to
the Offers) only accept for purchase on the Initial Settlement
Date, the Notes tendered at or prior to the Early Tender Time
resulting in the payment of an Aggregate Purchase Price not
exceeding the Tender Cap pursuant to the Acceptance Priority
Procedures (as defined below). If the Offers are not oversubscribed
at the Early Tender Time and the purchase of all Notes validly
tendered at or prior to the Expiration Time would cause
FEMSA to purchase an aggregate principal amount of Notes that
would result in an Aggregate Purchase Price (taking into account
the Total Consideration paid for Notes purchased on the Initial
Settlement Date) in excess of the Tender Cap, then the Offers will
be oversubscribed at the Expiration Time and FEMSA will (assuming
satisfaction or, where applicable, the waiver of the conditions to
the Offers) only accept for purchase all Notes validly tendered
prior to the Early Tender Time and purchase any Notes tendered
after the Early Tender Time resulting in a payment of an Aggregate
Purchase Price not exceeding the Tender Cap pursuant to the
Acceptance Priority Procedures.
In the Offers, subject to the satisfaction of the conditions to
the Offers, FEMSA will accept for purchase validly tendered
Notes in the order of the related acceptance priority level set
forth in the above table in the column under the heading
"Acceptance Priority Level" (the "Acceptance Priority Level"),
beginning at the lowest numerical value first, as described in the
following sentences, subject to the procedures described below for
undersubscribed Offers by the Early Tender Time. If the aggregate
principal amount of all validly tendered Notes corresponding to an
Acceptance Priority Level, when added to the aggregate principal
amount of all Notes accepted for purchase corresponding to each
higher Acceptance Priority Level (lower numerical value), if any,
would result in an Aggregate Purchase Price that does not exceed
the Tender Cap, then FEMSA will accept for purchase all such
tendered Notes of a series and will then apply the foregoing
procedure to the next lower Acceptance Priority Level (next higher
numerical value). If the condition described in the foregoing
sentence is not met, FEMSA will accept for purchase on a pro
rata basis the maximum aggregate principal amount of such tendered
Notes of the lowest Acceptance Priority Level (higher numerical
value) as FEMSA can while still satisfying that condition. No
tendered Notes in subsequent Acceptance Priority Levels will be
accepted for purchase, to the extent that the acceptance of
tendered Notes in previous Acceptance Priority Levels results in
the purchase of Notes with an Aggregate Purchase Price in excess of
the Tender Cap (as may be increased by FEMSA in its sole
discretion). If the Offers are not fully subscribed at the Early
Tender Time, subject to the Tender Cap, Notes tendered at or before
the Early Tender Time will be accepted for purchase in priority to
other Notes tendered after the Early Tender Time, even if such
Notes tendered after the Early Tender Time have a higher Acceptance
Priority Level than Notes tendered prior to the Early Tender Time.
FEMSA refers to the procedures described in this paragraph as
the "Acceptance Priority Procedures."
If proration of a series of tendered Notes is required,
FEMSA will determine the final proration factor as soon as
practicable after the Early Tender Time or Expiration Time, as
applicable, and will inform the Holders of such series of Notes of
the results of the proration. In the event proration is
required with respect to a series of Notes, FEMSA will
multiply the principal amount of each valid tender of such series
of Notes by the applicable proration rate and round the resulting
amount down to the nearest US$2,000
with respect to the U.S. Dollar Notes or €1,000 with respect to the
EUR Notes. The excess principal amount of Notes not accepted from
the tendering Holders will be promptly returned to such
Holders.
In determining if the Aggregate Purchase Price exceeds the
Tender Cap, the aggregate U.S. dollar-equivalent principal amount
of EUR Notes tendered and accepted in such Offers shall be
calculated at the applicable exchange rate, as of 11:00 a.m., New York
City time, on the Price Determination Date, as reported on
Bloomberg screen page "FXIP" under the heading "FX Rate vs. USD"
(or, if such screen is unavailable, a generally recognized source
for currency quotations selected by the Dealer Manager with quotes
as of a time as close as reasonably possible to the
aforementioned).
* * *
FEMSA has engaged BofA Securities, Inc. as dealer manager in
connection with the Offers (the "Dealer Manager"). Global
Bondholder Services Corporation is acting as the tender and
information agent for the Offers.
This press release is neither an offer to purchase nor a
solicitation of an offer to sell the Notes. The Offers are
not being made to Holders in any jurisdiction in which FEMSA is
aware that the making of the Offers would not be in compliance with
the laws of such jurisdiction. In any jurisdiction in which
the securities laws or blue sky laws require the Offers to be made
by a licensed broker or dealer, the Offers will be deemed to be
made on FEMSA's behalf by the Dealer Manager or one or more
registered brokers or dealers that are licensed under the laws of
such jurisdiction. Any questions or requests for assistance
regarding the Offers may be directed to BofA Securities, Inc. at
(888) 292-0070 (toll-free) or (646) 855-8988 (collect) or (+44)
(207) 996 5420. Requests for additional copies of the Offer
to Purchase and related documents may be directed to Global
Bondholder Services Corporation at (212) 430-3774 or (855) 654-2014
(toll-free).
Neither the Offer to Purchase nor any documents related to the
Offers have been filed with, nor have they been approved or
reviewed by, any federal or state securities commission or
regulatory authority of any country. No authority has passed
upon the accuracy or adequacy of the Offer to Purchase or any
documents related to the Offers, and it is unlawful and may be a
criminal offense to make any representation to the contrary.
FEMSA Forward
Announcement
The offers described above form an integral part of the series
of strategic initiatives announced by FEMSA on February 15, 2023, as a result of a thorough
strategic review of its business platform, including the bottom-up
definition of long-range plans for each business unit, as well as
the top-down analysis of FEMSA's corporate and capital structure.
That announcement is available at:
https://www.globenewswire.com/news-release/2023/02/15/2609255/0/en/FEMSA-Forward-Announcing-results-of-strategic-review.html.
That announcement does not form part of this communication.
About FEMSA
FEMSA is a company that creates economic and social value
through companies and institutions and strives to be the best
employer and neighbor to the communities in which it operates. It
participates in the retail industry through a Proximity Division
operating OXXO, a small-format store chain, OXXO Gas, a chain of
retail service stations, and Valora, an operator of convenience and
foodvenience formats present in 5 countries in Europe. In the retail industry it also
participates though a Health Division, which includes drugstores
and related activities and Digital@FEMSA, which includes Spin by
OXXO and OXXO Premia, among other loyalty and digital financial
services initiatives. In the beverage industry, it participates
through Coca-Cola FEMSA, the largest franchise bottler of Coca-Cola
products in the world by volume; and in the beer industry, as the
second largest shareholder of Heineken, one of the world's leading
brewers with operations in over 70 countries. FEMSA also
participates in the logistics and distribution industry through its
Strategic Business Unit, which additionally provides point-of-sale
refrigeration and plastic solutions to its business units and
third-party clients. Across its business units, FEMSA has more than
320,000 employees in 18 countries. FEMSA is a member of the Dow
Jones Sustainability MILA Pacific Alliance, the FTSE4Good Emerging
Index and the Mexican Stock Exchange Sustainability Index:
S&P/BMV Total México ESG, among other indexes that evaluate its
sustainability performance.
Forward-Looking
Statements
This press release contains forward-looking statements.
Forward-looking statements are information of a
non-historical nature or which relate to future events and are
subject to risks and uncertainties. No assurance can be given
that the transactions described herein will be consummated or as to
the ultimate terms of any such transactions. FEMSA undertakes
no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information or future events
or for any other reason.
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SOURCE FOMENTO ECONOMICO MEXICANO, S.A.B. DE C.V.