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2i Rete Gas S.p.A. (the Offeror) hereby announces that it invites all holders (the Noteholders) of its €600,000,000 3.00 per cent. Notes due 16 July 2024 (ISIN: XS1088274672) (the Notes) to tender the Notes for purchase by the Offeror for cash up to an aggregate maximum acceptance amount of €300,000,000 in aggregate nominal amount, subject to the Offeror’s right in its sole and absolute discretion to increase or decrease such amount (the Maximum Acceptance Amount) subject to the satisfaction of the New Issue Condition (as defined herein) and the other conditions described in the Tender Offer Memorandum dated 30 May 2023 (the Tender Offer Memorandum) (the Offer).
The Offer is 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.
Details of the Offers
Rationale and Background for the Offer
The Offer is 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 Offer. For further information, see “New Issue Condition” below.
New Issue Condition
The Offeror announced today its intention to issue, subject to market conditions, a series of euro- denominated senior fixed rate notes (the New Notes) under its €4,000,000,000 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 Offer 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 1 June 2023.
The Offeror is not under any obligation to accept for purchase any Notes tendered pursuant to the Offer. The acceptance for purchase by the Offeror of Notes tendered pursuant to the Offer 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).
Priority allocation of the New Notes
A Noteholder that wishes to subscribe for the New Notes in addition to tendering Notes for purchase pursuant to the Offer may receive priority (the New Issue Priority) in the allocation of the New Notes,
subject to (i) the issue of the New Notes, (ii) such Noteholder actually tendering Notes for purchase, or indicating its firm intention to any of the Dealer Managers to tender its Notes and (iii) such Noteholder making a separate application for the purchase of such New Notes to a Dealer Manager (in its capacity as a Joint Lead Manager of the issue of the New Notes) in accordance with the standard new issue procedures of the manager. When considering allocations of the New Notes, the Offeror intends to give preference to those Noteholders who, prior to such allocation, have tendered, or indicated to the Dealer Managers their intention to tender, Notes pursuant to the Offer. The aggregate principal amount of New Notes for which New Issue Priority will be given to such a Noteholder will be at the sole discretion of the Offeror and may be less than or equal to the aggregate principal amount of Notes validly tendered or in respect of which a firm intention to tender has been indicated by such Noteholder in the Offer. However, the Offeror is not obliged to allocate the New Notes to an investor which has validly tendered or indicated a firm intention to tender the Notes pursuant to the Offer.
In the event that a Noteholder validly tenders Notes pursuant to the Offer, such Notes will remain subject to the conditions of the Offer as set out in the Tender Offer Memorandum irrespective of whether that Noteholder receives all, part or none of any allocation of New Notes for which it has applied.
All Tender Instructions or applications to purchase New Notes are subject to all applicable securities laws and regulations in force in any relevant jurisdiction (including the jurisdiction of the relevant Noteholder).
It is the sole responsibility of each Noteholder to satisfy itself that it is eligible to purchase the New Notes before registering its interest with, and making an application to, a Dealer Manager (in its capacity as a Joint Lead Manager of the issue of the New Notes) for the purchase of the New Notes. Any failure to validly submit a Tender Instruction (including as a result of such Noteholder being ineligible to be offered or to be sold the New Notes in accordance with any applicable securities laws and regulations), or any failure of such Noteholder to make an application for the purchase of the New Notes in accordance with the standard new issue procedures of the relevant Joint Lead Manager of the issue of the New Notes, may result in no New Issue Priority being given in respect of such Tender Instruction.
Noteholders should note that the pricing and allocation of the New Notes are expected to take place prior to the Expiration Deadline for the Offer and any Noteholder that wishes to subscribe for New Notes in addition to tendering existing Notes for purchase pursuant to the Offer should therefore provide, as soon as practicable, to the relevant Dealer Manager any indications of a firm intention to tender Notes for purchase pursuant to the Offer and the principal amount of Notes that it intends to tender in order for this to be taken into account as part of the New Notes allocation process.
Maximum Acceptance Amount
If the Offeror decides, in its sole and absolute discretion, to accept valid tenders of the Notes pursuant to the Offer, it will accept the Notes for purchase pursuant to the Offer up to the Maximum Acceptance Amount. The final Maximum Acceptance Amount will be announced in the Announcement of Results of the Offer. The Offeror expects to announce a non-binding indication of the Maximum Acceptance Amount in the Announcement of Indicative Results of the Offer 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 Maximum Acceptance Amount.
Final Acceptance Amount and Scaling of Tenders
Final Acceptance Amount
If the Offeror decides, in its sole and absolute discretion, to accept valid tenders of the Notes for purchase pursuant to the Offer, it will accept for purchase a principal amount of Notes up to the Maximum Acceptance Amount, although the Offeror reserves the right, in its sole and absolute discretion, to accept for purchase pursuant to the Offer more or significantly less than the Maximum Acceptance Amount (or none of the Notes) (the final principal amount of Notes accepted, if any, for purchase pursuant to the Offer being the Final Acceptance Amount).
If the Offeror accepts any Notes validly offered for purchase pursuant to the Offer and the aggregate nominal amount of Notes validly offered for purchase is greater than the Maximum Acceptance Amount, the Offeror intends to accept such validly tendered Notes for purchase in the manner set out under “Scaling of Tenders” below, such that the principal amount of Notes accepted for purchase does not exceed the Final Acceptance Amount. See further “Scaling of Tenders” below.
Scaling of Tenders
Notes validly submitted for tender will be accepted subject to applicable pro-ration (if any). In the event that the aggregate principal amount of Notes validly tendered pursuant to the Offer is greater than the Final Acceptance Amount, such Tender Instructions will be accepted on a pro-rata basis such that the aggregate principal amount of Notes accepted for purchase pursuant to the Offer is no greater than the Final Acceptance Amount.
Such pro-rata allocations will be calculated in relation to the Notes by multiplying the aggregate principal amount of the Notes represented by each Tender Instruction subject to pro-ration by a factor derived from
(i) the Final Acceptance Amount divided by (ii) the aggregate principal amount of the Notes validly tendered in the Offer (the Pro-Ration Factor) (subject to adjustment to allow for the aggregate principal amount of Notes accepted for purchase, following the rounding of Tender Instructions as set out below, to equal the Final Acceptance Amount).
Each tender of Notes reduced in this manner will be rounded down to the nearest €1,000 in aggregate principal amount. In addition, in the event of any such scaling of tenders:
(A) the Offeror will use reasonable endeavours to apply pro rata scaling (to the extent practicable, and adjusted as may be applicable) to each valid tender of Notes in such a manner as will result in both (a) the relevant Noteholder transferring to the Offeror an aggregate principal amount of at least the minimum denomination of the Notes (being €100,000) (unless the relevant Tender Instruction is rejected in its entirety, as described in paragraph (B) below), and (b) the relevant Noteholder’s residual amount of Notes (being the principal amount of the Notes the subject of the relevant Tender Instruction that are not accepted for purchase by virtue of such scaling) amounting to, in each case, either (i) at least €100,000 or (ii) zero, and (subject as provided in paragraph (B) below) the Offeror therefore reserves the right (but shall not be obliged) to adjust the pro-rata scaling applicable to any relevant Tender Instruction accordingly; and
(B) if following the application of the pro-rata scaling (prior to any adjustment as referred to in paragraph(A) above), the principal amount of Notes otherwise due to be accepted for purchase from a Noteholder pursuant to a Tender Instruction would be less than €100,000, the Offeror may in its sole and absolute discretion choose to (i) accept at least €100,000, being the minimum denomination of the Notes or (ii) reject the relevant Tender Instruction in its entirety.
if following the application of the pro-rata scaling (prior to any adjustment as referred to in paragraph
(a) the product of (i) the aggregate nominal amount of such Notes accepted for purchase from such Noteholder pursuant to the Offer and (ii) the Purchase Price (such product, the relevant Purchase Consideration); and
(b) the Accrued Interest Payment on the Notes.
Purchase Price
The Offeror will pay, for the Notes accepted by it for purchase pursuant to the Offer, the price (the Purchase Price, expressed as a percentage and rounded to the nearest 0.001 per cent., with 0.0005 per cent. being rounded upwards) to be determined at the Pricing Time on the Pricing Date in the manner described in the Tender Offer Memorandum by reference to the sum (such sum, the Purchase Yield) of the Purchase Spread and the July 2024 Interpolated Mid-Swap Rate.
The Purchase Price will be determined at the Pricing Time on the Pricing Date as described below in accordance with market convention, and is intended to reflect a yield to maturity of the Notes on the Tender Offer Settlement Date based on the relevant Purchase Yield. Specifically, the Purchase Price will equal (a) the value of all remaining payments of principal and interest on the tendered Notes up to and including the scheduled maturity date of the Notes, discounted to the Tender Offer Settlement Date at a discount rate equal to the relevant Purchase Yield, minus (b) the relevant Accrued Interest. See “Accrued Interest Payment” below.
Accrued Interest Payment
The Offeror will also pay an Accrued Interest Payment in respect of Notes accepted for purchase pursuant to the Offer.
Tender Instructions
In order to participate in, and be eligible to receive the Purchase Consideration and relevant Accrued Interest Payment pursuant to the 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. (CEST) on 6 June 2023 (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 Offer 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 no less than
€100,000, being the minimum denomination of the 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 less than the 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 Offer. The times and dates below are indicative only.
The above times and dates are subject to the right of the Offeror to extend, re-open, amend and/or terminate the Offer (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, the 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 Offer is set out in the Tender Offer Memorandum. BNP Paribas, BofA Securities Europe SA, Goldman Sachs International and UniCredit Bank AG are the Dealer Managers for the Offer.
Questions and requests for assistance in connection with the Offer may be directed to:
OFFEROR
2i Rete Gas S.p.A.
Via Alberico Albricci, 10 20122 Milan
Italy
DEALER MANAGERS
BNP Paribas
16, boulevard des Italiens 75009 Paris
France Telephone: +33 1 55 77 78 94
Attention: Liability Management Group
Email: liability.management@bnpparibas.com
Goldman Sachs International
Shoe Lane, 25 EC4A 4AU London United Kingdom
Telephone: +44 20 7774 4836 Email: liabilitymanagement.eu@gs.com
Attn: Liability Management
BofA Securities Europe SA
51, rue La Boétie 75008 Paris France
Attn: Liability Management Group Tel: +33 1 877 01057
Email: DG.LM-EMEA@bofa.com
UniCredit Bank AG
Arabellastrasse 12
81925 Munich Germany
Attention: Liability Management Telephone: +49 89 3781 3722
Email: corporate.lm@unicredit.de
TENDER AGENT
Kroll Issuer Services Limited
The Shard
32 London Bridge Street London SE1 9SG United Kingdom
Attention: Jacek Kusion Telephone: +44 (0)20 7704 0880
Email: 2iretegas@is.kroll.com
Website: https://deals.is.kroll.com/2iretegas
Each Noteholder is solely responsible for making its own independent appraisal of all matters as such Noteholder deems appropriate (including those relating to the Offer) 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 the Offer.
None of the Dealer Managers, the Tender Agent or any of their respective directors, officers, employees, agents, advisors or affiliates assumes any responsibility for the accuracy or completeness of the information concerning the Offeror, the Notes or the Offer 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, advisors 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, advisors 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 Offer 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, advisors or affiliates makes any representation or recommendation whatsoever regarding the Offer, or any recommendation as to whether Noteholders should tender the Notes in the Offer.