NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO OR TO ANY PERSON LOCATED OR RESIDENT IN THE UNITED STATES, ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES OR THE DISTRICT OF COLUMBIA (INCLUDING PUERTO RICO, THE U.S. VIRGIN ISLANDS, GUAM, AMERICAN SAMOA, WAKE ISLAND AND THE NORTHERN MARIANA ISLANDS) OR TO ANY U.S. PERSON (AS DEFINED IN REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE SECURITIES ACT)) (EACH, A U.S. PERSON) OR IN OR INTO OR TO ANY PERSON LOCATED OR RESIDENT IN ANY OTHER JURISDICTION WHERE IT IS UNLAWFUL TO DISTRIBUTE THIS DOCUMENT.
2i Rete Gas S.p.A. (the Offeror) hereby announces that it invites all holders (the
Noteholders) of its €750,000,000 1.75 per cent. Notes due 16 July 2019 (ISIN: XS1088274169) (of which
€524,999,000 are currently outstanding) (the 2019 Notes) and its outstanding €540,000,000 1.125 per cent. Notes due 2 January 2020 (ISIN: XS1144492532) (the 2020 Notes and together with the 2019 Notes, the Notes and each a Series) to tender respectively (i) any and all of the 2020 Notes for purchase by the Offeror for cash and (ii) the 2019 Notes for purchase by the Offeror for cash up to an aggregate maximum acceptance amount of €400,000,000 in aggregate nominal amount less the aggregate nominal amount of the 2020 Notes validly tendered and accepted for purchase by the Offeror, subject to the Offeror’s right in its sole and absolute discretion to increase or decrease such amount (the 2019 Notes Maximum Acceptance Amount) in each case subject to the satisfaction of the New Issue Condition (as defined below) and other conditions described in the in the tender offer memorandum dated 14 February 2017 (the Tender Offer Memorandum) (the Offers and each an Offer).
The Offers are subject to the offer and distribution restrictions set out below. Capitalised terms used in this announcement and not otherwise defined have the meanings ascribed to them in the Tender Offer Memorandum.
* The Offeror reserves the right, in its sole and absolute discretion and for any reason, to increase or decrease the 2019 Notes Maximum Acceptance Amount.
** For information purposes only, the 2020 Notes Purchase Price determined in the manner described in “Purchase Price” below, will be 103.199 per cent., if the Tender Offer Settlement Date is 28 February 2017. Should the Tender Offer Settlement Date be postponed, the 2020 Notes Purchase Price will be recalculated and will be announced, for information purposes only, as provided in the Tender Offer Memorandum.
*** For information purposes only, the 2019 Notes Purchase Price determined in the manner described in “Purchase Price” below, will be 104.284 per cent., if the Tender Offer Settlement Date is 28 February 2017. Should the Tender Offer Settlement Date be postponed, the 2019 Notes Purchase Price will be recalculated and will be announced, for information purposes only, as provided in the Tender Offer Memorandum.
Details of the Offers
Rationale and Background for the Offers
The Offers are being made as part of the Offeror’s medium-term financial strategy aimed at pro-actively managing its liabilities and cost of debt financing. The Offeror’s intention is to cancel all of the Notes acquired pursuant to the Offers. For further information, see “Details of the Offers – New Issue Condition” below.
New Issue Condition
The Offeror announced today its intention to issue, subject to market conditions, a series of new euro- denominated senior fixed rate notes (the New Notes) under its €3,500,000,000 Euro Medium Term Note Programme (the Programme), which are intended to be subscribed for by the Joint Lead Managers.
The purchase by the Offeror of any Notes validly tendered in the Offers is subject, without limitation, to the issue and settlement of the New Notes (the New Issue Condition). The signing by the Offeror and the Joint Lead Managers of a subscription agreement for the purchase of, and subscription for, the New Notes is expected to occur on or around 24 February 2017.
The Offeror is not under any obligation to accept for purchase any Notes tendered pursuant to the Offers. The acceptance for purchase by the Offeror of Notes tendered pursuant to the Offers is at the sole and absolute discretion of the Offeror and tenders may be rejected by the Offeror for any reason in its sole and absolute discretion, irrespective of the New Issue Condition being satisfied (or waived).
2019 Notes Maximum Acceptance Amount
If the Offeror decides, in its sole and absolute discretion, to accept valid tenders of 2019 Notes pursuant to the relevant Offer, it will accept 2019 Notes for purchase pursuant to the relevant Offer up to the 2019 Notes Maximum Acceptance Amount. The final 2019 Notes Maximum Acceptance Amount will be announced in the Announcement of Conditional Results of Offers. The Offeror expects to announce a non-binding indication of the 2019 Notes Maximum Acceptance Amount in the Announcement of Indicative Results of the Offers as soon as reasonably practicable on the Pricing Date, provided that the Offeror has the right, in its sole and absolute discretion and for any reason, to change any such non- binding indication of the 2019 Notes Maximum Acceptance Amount or to accept for purchase an aggregate nominal amount of Notes less than or more than any such non-binding indication of the 2019 Notes Maximum Acceptance Amount. The Offeror reserves the right to accept, in its sole and absolute discretion, only the 2020 Notes.
For the avoidance of doubt, if the 2020 Notes Acceptance Amount (as defined below) is equal to, or greater than, Euro 400,000,000, the Offeror may, in its sole and absolute discretion, accept none of the 2019 Notes validly tendered unless it elects, in its sole and absolute discretion, to increase the 2019 Notes Maximum Acceptance Amount.
Series Acceptance Amounts and Scaling of Tenders Series Acceptance Amounts
If the Offeror decides, in its sole and absolute discretion, to accept any valid tender of 2020 Notes for purchase, pursuant to the relevant Offer, it will accept for purchase all of the 2020 Notes that are validly tendered (the aggregate principal amount of such validly tendered and accepted 2020 Notes being the 2020 Notes Acceptance Amount), with no pro rata scaling.
If the Offeror decides, in its sole and absolute discretion, to accept valid tenders of 2019 Notes for purchase pursuant to the relevant Offer, it will accept for purchase an amount in principal up to the 2019 Notes Maximum Acceptance Amount, although the Offeror reserves the right, in its sole and absolute discretion, to accept for purchase pursuant to the relevant Offer more or significantly less than the 2019 Notes Maximum Acceptance Amount (or none of the 2019 Notes) (the final principal amount of 2019 Notes accepted, if any, for purchase pursuant to the relevant Offer being the 2019 Notes Acceptance Amount).
If the Offeror accepts any 2019 Notes validly offered for purchase pursuant to the relevant Offer and the aggregate nominal amount of 2019 Notes validly offered for purchase is greater than the 2019 Notes Maximum Acceptance Amount, the Offeror intends to accept such validly tendered 2019 Notes for
purchase in the manner set out under “Scaling of Tenders” below, such that the aggregate principal amount of the 2019 Notes accepted for purchase does not exceed the 2019 Notes Acceptance Amount. See further “Scaling of Tenders” below.
Scaling of Tenders
The Offeror is under no obligation to accept for purchase any Notes tendered pursuant to the Offers. The acceptance for purchase by the Offeror of Notes validly tendered pursuant to the Offers is at the sole and absolute discretion of the Offeror and tenders may be rejected by the Offeror for any reason in its sole and absolute discretion, irrespective of the New Issue Condition (as defined above) being satisfied (or waived).
No scaling of Tenders of 2020 Notes
If the Offeror decides to accept any valid tenders of 2020 Notes for purchase pursuant to the relevant Offer there will be no scaling of tenders of the 2020 Notes.
Scaling of Tenders of 2019 Notes
In the circumstances in which valid tenders of 2019 Notes pursuant to the relevant Offer are to be accepted, at the sole and absolute discretion of the Offeror, on a pro rata basis, each such valid tender of 2019 Notes will be scaled by a factor (the Pro-Ration Factor) equal to (i) the 2019 Notes Acceptance Amount, divided by (ii) the aggregate principal amount of 2019 Notes validly tendered pursuant to the relevant Offer (subject to any adjustments following the rounding of tenders of 2019 Notes as described below).
Each tender of 2019 Notes that is scaled in this manner will be rounded down to the nearest €1,000 provided, in each case, that the Offeror will only accept valid tenders of 2019 Notes to the extent any such pro-rating would not result in the relevant Noteholder transferring 2019 Notes in an aggregate nominal amount which is less than the relevant Minimum Denomination (as defined below) of the 2019 Notes or the 2019 Notes being returned to the relevant Noteholder in an aggregate amount which is less than the relevant Minimum Denomination of the 2019 Notes.
Total amounts payable to Noteholders
If the Offeror decides to accept valid tenders of Notes pursuant to the relevant Offer, the total amount that will be paid to each Noteholder on the Tender Offer Settlement Date for such Notes accepted for purchase from such Noteholder will be an amount (rounded to the nearest €0.01, with €0.005 rounded upwards) equal to the sum of:
(a) the product of (i) the aggregate nominal amount of such Notes accepted for purchase from such Noteholder pursuant to the relevant Offer and (ii) the relevant Purchase Price (such product, the relevant Purchase Consideration); and
(b) the Accrued Interest Payment on such Notes.
Purchase Price
The Offeror will pay, for the 2019 Notes and 2020 Notes accepted by it for purchase pursuant to the relevant Offer, the relevant price (the relevant Purchase Price, expressed as a percentage and rounded to the nearest 0.001 per cent., with 0.0005 per cent. being rounded upwards) as described below.
The Dealer Managers will determine on the Pricing Date (i) the Purchase Price in relation to the 2020 Notes (the 2020 Notes Purchase Price) by reference to a fixed yield to maturity of 0 per cent.1 (the 2020 Notes Purchase Yield) and (ii) the Purchase Price in relation to the 2019 Notes (the 2019 Notes Purchase Price) by reference to a fixed yield to maturity of -0.05 per cent.2 (the 2019 Notes Purchase Yield), in accordance with market convention with reference to the Tender Offer Settlement Date.
Accrued Interest Payment
___________________________
1 For information purposes only, the 2020 Notes Purchase Price will be 103.199 per cent., if the Tender Offer Settlement Date is 28 February 2017. Should the Tender Offer Settlement Date be postponed, the 2020 Notes Purchase Price will be recalculated and will be announced, for information purposes only, as provided in the Tender Offer Memorandum.
2 For information purposes only, the 2019 Notes Purchase Price will be 104.284 per cent., if the Tender Offer Settlement Date is 28 February 2017. Should the Tender Offer Settlement Date be postponed, the 2019 Notes Purchase Price will be recalculated and will be announced, for information purposes only, as provided in the Tender Offer Memorandum.
The Offeror will also pay an Accrued Interest Payment in respect of Notes accepted for purchase pursuant to the Offers.
Tender Instructions
In order to participate in, and be eligible to receive the relevant Purchase Consideration and relevant Accrued Interest Payment pursuant to the relevant Offer, Noteholders must validly tender their Notes by delivering, or arranging to have delivered on their behalf, a valid Tender Instruction that is received by the Tender Agent by 5.00 p.m. (CET) on 20 February 2017 (the Expiration Deadline).
Noteholders are advised to check with any bank, securities broker or other intermediary through which they hold Notes when such intermediary would need to receive instructions from a Noteholder in order for that Noteholder to be able to participate in, or (in the limited circumstances in which revocation is permitted) revoke their instruction to participate in, the Offers by the deadlines specified in the Tender Offer Memorandum. The deadlines set by any such intermediary and each Clearing System for the submission and withdrawal of Tender Instructions will be earlier than the relevant deadlines specified in the Tender Offer Memorandum.
Once submitted, Tender Instructions will be irrevocable except in the limited circumstances described in the Tender Offer Memorandum.
Tender Instructions must be submitted in respect of a minimum nominal amount of Notes of any Series of no less than €100,000, being the minimum denomination of each of the two Series (in relation to each Series of Notes, the Minimum Denomination) and may thereafter be submitted in integral multiples of
€1,000. Tender Instructions which relate to a nominal amount of Notes of one Series of less than the relevant Minimum Denomination will be rejected. A separate Tender Instruction must be completed on behalf of each beneficial owner.
Expected Timetable of Events
The following table sets forth the expected dates and times of the key events relating to the Offers. The times and dates below are indicative only.
| Events | Times and Dates (All times are CET) |
| Commencement of the Offers Announcement of the Offers. Tender Offer Memorandum available from the Tender Agent (subject to offer and distribution restrictions). | Tuesday, 14 February 2017 |
| Expiration Deadline Final deadline for receipt of valid Tender Instructions by the Tender Agent in order for Noteholders to be able to participate in the Offers. | 5.00 p.m. on Monday, 20 February 2017 |
| Pricing of New Notes Expected pricing of New Notes. | On or around Tuesday, 21 February 2017, but such date is subject to change without notice |
| Pricing Date Expected pricing of the Offers to take place the later of the day on which the issue of the New Notes is priced or the day following the Expiration Deadline. | On or around Tuesday, 21 February 2017, but such date is subject to change without notice |
| Announcement of Indicative Results of the Offers Announcement by the Offeror of a non-binding indication of whether it intends to accept valid tenders of Notes pursuant to the Offers and, if so (i) a non-binding indication of the 2019 Notes Maximum Acceptance Amount and the level at which it expects to set (a) the 2019 Notes Acceptance Amount and (b) the 2020 Notes Acceptance Amount, (ii) the aggregate nominal amount of Notes validly tendered pursuant to the Offers, and (iii) in respect of the 2019 Notes, any indicative Pro-Ration Factor, subject in each case to, inter alia, satisfaction or waiver of the New Issue Condition. | As soon as reasonably practicable on the Pricing Date |
| Announcement of Conditional Results of Offers Provided that the Offer does not elect to withdraw or terminate the Offers in accordance with “Amendment, Termination and Revocation” in the Tender Offer Memorandum, announcement of whether the Offeror will, subject to the satisfaction (or waiver) of the New Issue Condition, accept and purchase validly tendered Notes of any Series pursuant to the relevant Offer and, if so (i) the final 2019 Notes Maximum Acceptance Amount, (ii) the 2019 Notes Acceptance Amount, (iii) the 2020 Notes Acceptance Amount, (iv) in relation to each Series of Notes, the aggregate nominal amount of Notes validly tendered, (v) in respect of the 2019 Notes, any Pro-Ration Factor, (vi) the 2019 Notes Purchase Price, (vii) the 2020 Notes Purchase Price and (viii) any Accrued Interest for the Notes accepted for purchase. | As soon as reasonably practicable following the later of the pricing of the New Notes on the Pricing Date or the Announcement of Indicative Results of the Offers |
| Events | Times and Dates (All times are CET) |
| New Issue Settlement Date Expected date of issue and settlement of New Notes (subject to satisfaction of customary conditions precedent). | Tuesday, 28 February 2017, or (if different) 5 Business Days following the pricing of the New Notes |
| Final Announcement Announcement by the Offeror of whether the New Issue Condition has been satisfied. | As soon as practicable on the New Issue Settlement Date |
| Tender Offer Settlement Date Subject to the satisfaction or waiver of the New Issue Condition, expected Tender Offer Settlement Date for the Offers. | As soon as practicable on the New Issue Settlement Date |
The above times and dates are subject to the right of the Offeror to extend, re-open, amend and/or terminate any of the Offers (subject to applicable laws and regulations and as provided in the Tender Offer Memorandum). Noteholders are advised to check with any bank, securities broker or other intermediary through which they hold Notes when such intermediary would need to receive instructions from a Noteholder in order for that Noteholder to be able to participate in, or (in the limited circumstances in which revocation is permitted) revoke their instruction to participate in, any Offer, before the deadlines specified in the Tender Offer Memorandum. The deadlines set by any such intermediary and each Clearing System for the submission of Tender Instructions will be earlier than the relevant deadlines specified above.
Further Information
A complete description of the terms and conditions of the Offers is set out in the Tender Offer Memorandum. Banca IMI S.p.A., BNP Paribas, Mediobanca – Banca di Credito Finanziario S.p.A., Merrill Lynch International, Société Générale and Unicredit bank AG are the Dealer Managers for the Offers.
Questions and requests for assistance in connection with the Offers may be directed to:
OFFEROR
2i Rete Gas S.p.A.
Via Alberico Albricci, 10 20122 Milan
Italy
DEALER MANAGERS
Banca IMI S.p.A.
Largo Mattioli, 3
20121 Milan Italy
Attention: Liability Management Telephone: +39 02 7261 5938
Email: Liability.Management@bancaimi.com
Mediobanca – Banca di Credito Finanziario S.p.A.
Piazzetta Enrico Cuccia, 1
20121 Milan Italy
Attention: Liability Management Group Telephone: +39 02 8829 840
Email: MB_LM_CORP_IT@mediobanca.com
Société Générale
10 Bishops Square London E1 6EG United Kingdom
Attention: Liability Management Telephone: +44 20 7676 7680
Email: liability.management@sgcib.com
BNP Paribas
10 Harewood Avenue London NW1 6AA United Kingdom
Attention: Liability Management Telephone: +39 02 7261 5938
Email: Liability.Management@bancaimi.com
Attention: Liability Management Group Telephone: +44 (0)20 7595 8668
Email: liability.management@bnpparibas.com
Merrill Lynch International
1 2 King Edward Street
London EC1A 1HQ
United Kingdom
Attention: Liability Management Group Telephone: +44 (0) 20 7996 5420 Email: DG.LM_EMEA@baml.com
UniCredit Bank AG
Arabellastrasse 12
81925 Munich Germany
Attention: Liability Management Telephone: +49 89 3781 3722 Email: corporate.lm@unicredit.de
TENDER AGENT
Lucid Issuer Services Limited
Tankerton Works 12 Argyle Walk
London WC1H 8HA United Kingdom
Attention: Arlind Bytyqi / Paul Kamminga
Telephone: +44 20 7704 0880
Email: 2iretegas@lucid-is.com
Each Noteholder is solely responsible for making its own independent appraisal of all matters as such Noteholder deems appropriate (including those relating to the relevant Offer(s)) and each Noteholder must make its own decision, based upon its own judgement and upon advice from such financial, accounting, legal and tax advisers as it has deemed necessary, as to whether to tender any or all of its Notes for purchase pursuant to such Offer(s).
None of the Dealer Managers, the Tender Agent or any of their respective directors, officers, employees, agents or affiliates assumes any responsibility for the accuracy or completeness of the information concerning the Offeror, the Notes or the Offers contained in this announcement or in the Tender Offer Memorandum. None of the Offeror, the Dealer Managers, the Tender Agent or any of their respective directors, officers, employees, agents or affiliates is acting for any Noteholder, or will be responsible to any Noteholder for providing any protections which would be afforded to its clients or for providing advice in relation to the Offers, and accordingly none of the Dealer Managers, the Tender Agent or any of their respective directors, officers, employees, agents or affiliates assumes any responsibility for any failure by the Offeror to disclose information with regard to the Offeror or the Notes which is material in the context of the Offers and which is not otherwise publicly available.
None of the Offeror, the Dealer Managers, the Tender Agent or any of their respective directors, officers, employees, agents or affiliates make any representation or recommendation whatsoever regarding the Offers, or any recommendation as to whether Noteholders should tender the Notes in the Offers.