BT PLC ANNOUNCES TENDER OFFERS

British Telecommunications PLC

13 June 2024

 

THIS ANNOUNCEMENT RELATES TO THE DISCLOSURE OF INFORMATION THAT QUALIFIED OR MAY HAVE QUALIFIED AS INSIDE INFORMATION WITHIN THE MEANING OF ARTICLE 7(1) OF THE MARKET ABUSE REGULATION (EU) 596/2014 AS IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018, AS AMENDED.

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO OR TO ANY PERSON LOCATED OR RESIDENT IN THE UNITED STATES OF AMERICA, ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES OF AMERICA OR THE DISTRICT OF COLUMBIA (THE "UNITED STATES") OR IN OR INTO OR TO ANY PERSON LOCATED OR RESIDENT IN ANY OTHER JURISDICTION WHERE OR TO WHOM IT IS UNLAWFUL TO RELEASE, PUBLISH OR DISTRIBUTE THIS ANNOUNCEMENT.

13 June 2024

BRITISH TELECOMMUNICATIONS PUBLIC LIMITED COMPANY ANNOUNCES TENDER OFFERS

British Telecommunications public limited company (the "Offeror") announces that it is inviting holders of its outstanding EUR 650,000,000 0.500 per cent. Notes due 12 September 2025 (ISIN: XS2051494222) (the "2025 Notes") and EUR 1,300,000,000 1.750 per cent. Notes due 10 March 2026 (ISIN: XS1377679961) (the "2026 Notes" and together with the 2025 Notes, the "Notes" and each a "Series") to tender their Notes for purchase by the Offeror for cash in an aggregate nominal amount of up to the Maximum Acceptance Amount (as defined below), subject to pro rata scaling, if applicable, and subject to applicable law and regulation and the offer and distribution restrictions and the satisfaction or waiver of the New Financing Condition (as defined below) and the other conditions described in the tender offer memorandum dated 13 June 2024 (the "Tender Offer Memorandum") (each such invitation an "Offer" and together the "Offers").

Description	ISIN	Outstanding Nominal Amount	Benchmark Rate	Fixed Spread (basis points)	Purchase Price	Maximum Acceptance Amount
EUR 650,000,000 0.500 per cent. Notes due 12 September 2025	XS2051494222	EUR 650,000,000	2025 Notes Interpolated Mid-Swap Rate	+0	To be determined at the Pricing Time	Subject as set out herein, up to an aggregate nominal amount of the Notes expected to be equal to the aggregate nominal amount of the New Notes (as defined below) (the "Maximum Acceptance Amount"). The Maximum Acceptance Amount will be announced as soon as practicable after the pricing of the New Notes, subject to the right of the Offeror to increase or decrease such amount in its sole and absolute discretion
EUR 1,300,000,000 1.750 per cent. Notes due 10 March 2026	XS1377679961	EUR 1,300,000,000	2026 Notes Interpolated Mid-Swap Rate	+15	To be determined at the Pricing Time
THE OFFERS WILL COMMENCE ON 13 JUNE 2024 AND WILL EXPIRE AT 4.00 P.M. (LONDON TIME) ON 19 JUNE 2024 (THE "EXPIRATION TIME") UNLESS EXTENDED, WITHDRAWN, AMENDED OR TERMINATED AT THE SOLE AND ABSOLUTE DISCRETION OF THE OFFEROR. THE DEADLINES SET BY ANY INTERMEDIARY OR CLEARING SYSTEM WILL BE EARLIER THAN THE ABOVE DEADLINE.

The Offers are made on the terms and subject to the conditions (including satisfaction or waiver of the New Financing Condition) contained in the Tender Offer Memorandum and should be read in conjunction with the Tender Offer Memorandum. Capitalised terms used but not otherwise defined in this announcement shall have the meaning given to them in the Tender Offer Memorandum.

Rationale for the Offers

The rationale for the Offers is to optimise the liquidity and debt maturity profile of the Offeror and BT Group plc. Notes purchased by the Offeror pursuant to the Offers will be cancelled and will not be re-issued or re-sold. Notes which have not been validly submitted and accepted for purchase pursuant to the Offers will remain outstanding.

Details of the Offers

The submission of a valid Tender Instruction through the Clearing Systems will be irrevocable except in the limited circumstances in which the revocation of a Tender Instruction is specifically permitted in accordance with the terms of the Offers.

Purchase Price

The 2025 Notes Purchase Price will be calculated at or around the Pricing Time as the price (expressed as a percentage of the nominal amount of the 2025 Notes accepted for purchase pursuant to the 2025 Notes Offer and rounded to the third decimal place, with 0.0005 being rounded upwards) equal to (a) each remaining payment of principal and interest on the 2025 Notes up to and including 12 September 2025 (being the maturity date of the 2025 Notes), discounted to the Settlement Date at a discount rate equal to the 2025 Notes Repurchase Yield (being the sum of the 2025 Notes Interpolated Mid-Swap Rate and the 2025 Notes Fixed Spread), less (b) the Accrued Interest in respect of the 2025 Notes.

The 2026 Notes Purchase Price will be calculated at or around the Pricing Time as the price (expressed as a percentage of the nominal amount of the 2026 Notes accepted for purchase pursuant to the 2026 Notes Offer and rounded to the third decimal place, with 0.0005 being rounded upwards) equal to (a) each remaining payment of principal and interest on the 2026 Notes up to and including 10 March 2026 (being the maturity date of the 2026 Notes), discounted to the Settlement Date at a discount rate equal to the 2026 Notes Repurchase Yield (being the sum of the 2026 Notes Interpolated Mid-Swap Rate and the 2026 Notes Fixed Spread), less (b) the Accrued Interest in respect of the 2026 Notes.

The determination of the 2025 Notes Purchase Price and the 2026 Notes Purchase Price will, in the absence of manifest error, be final and binding on all parties.

Tender Consideration

The consideration (the "Tender Consideration") payable, subject to satisfaction or waiver of the New Financing Condition, on the Settlement Date to a Qualifying Holder whose Notes are validly Offered for Sale and accepted for purchase by the Offeror pursuant to the Offers will be an amount in EUR equal to the sum of: (i) the product of (x) the relevant Purchase Price and (y) the nominal amount of the relevant Notes; and (ii) the relevant Accrued Interest Amount in respect of such Notes, rounded, if necessary, to the nearest EUR 0.01, with EUR 0.005 being rounded upwards.

Maximum Acceptance Amount and Acceptance on a Pro-Rata Basis

The Offeror proposes to accept Notes for purchase up to the Maximum Acceptance Amount on the terms and subject to the conditions (including the satisfaction or waiver of the New Financing Condition) contained in the Tender Offer Memorandum (although the Offeror reserves the right, in its sole and absolute discretion and for any reason, to increase or decrease the Maximum Acceptance Amount).

Until the Offeror announces the final aggregate nominal amount of each Series (if any) accepted for purchase, no assurance can be given that any Notes validly Offered for Sale pursuant to the Offers will be accepted. Even if the New Financing Condition is satisfied, the acceptance of any Notes validly Offered for Sale is at the sole and absolute discretion of the Offeror and the Offeror reserves the absolute right not to accept any Notes validly Offered for Sale pursuant to the Offers. The Offeror will determine the allocation of the aggregate nominal amount accepted for purchase pursuant to the Offers among each Series (the "Series Acceptance Amounts" and each, a "Series Acceptance Amount") in its sole and absolute discretion and may purchase considerably less (or none) of one Series than of another Series.

If the Offeror decides to accept Notes of any Series for purchase pursuant to the Offers and in the event that valid Tender Instructions are received in respect of an aggregate nominal amount of a Series which is greater than the relevant Series Acceptance Amount, such Tender Instructions will be accepted on a pro rata basis as further set out in the Tender Offer Memorandum such that the aggregate nominal amount of such Series accepted for purchase is no greater than the relevant Series Acceptance Amount.

New Notes and New Financing Condition

The Offeror announced on 13 June 2024 its intention, subject to market conditions, to issue a new series of euro-denominated fixed rate notes (the "New Notes"), unconditionally and irrevocably guaranteed by BT Group plc. Whether the Offeror will accept for purchase any Notes validly tendered in the Offers is subject, without limitation, to (unless such condition is waived by the Offeror in its sole and absolute discretion) the successful completion (in the sole determination of the Offeror) of the issue of the New Notes (the "New Financing Condition").

Allocation of the New Notes

When considering allocation of the New Notes, the Offeror intends to give preference to those Holders who, prior to such allocation, have validly tendered (or have given a firm indication to the Offeror or any Dealer Manager that they intend to tender) their Notes pursuant to the Offers. Therefore, a Holder who wishes to subscribe for New Notes in addition to tendering its Notes for purchase pursuant to the Offers may be eligible to receive, at the sole and absolute discretion of the Offeror, priority in the allocation of the New Notes, subject to the issue of the New Notes and such Holder 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 such Dealer Manager. However, the Offeror is not obliged to allocate the New Notes to a Holder who has validly tendered or indicated a firm intention to tender the Notes pursuant to the Offers and, if New Notes are allocated, the nominal amount thereof may be less or more than the nominal amount of Notes tendered by such Holder and accepted by the Offeror pursuant to the Offer. Any such allocation will also, among other factors, take into account the minimum denomination of the New Notes (being EUR 100,000 in the case of the New Notes).

All allocations of the New Notes, while being considered by the Offeror as set out above, will be made in accordance with customary new issue allocation processes and procedures. In the event that a Holder validly tenders Notes pursuant to the Offer, such Notes will remain subject to such tender and the conditions of the Offers as set out in the Tender Offer Memorandum irrespective of whether that Holder receives all, part or none of any allocation of New Notes for which it has applied.

Holders should note that the pricing and allocation of the New Notes are expected to take place prior to the Expiration Time and any Holder that wishes to subscribe for New Notes in addition to tendering existing Notes for purchase pursuant to the Offers should therefore provide, as soon as practicable, and prior to the allocation of the New Notes, to any Dealer Manager any indications of a firm intention to tender Notes for purchase pursuant to the Offers and the quantum of Notes that it intends to tender in order for this to be taken into account as part of the New Notes allocation process.

Expected Timetable of Events

Events/Dates	Times and Dates
Launch Date Offers announced. Clearing System Notices distributed via the Clearing Systems and Tender Offer Memorandum available to Qualifying Holders upon request from the Tender Agent.	13 June 2024
Announcement of the Maximum Acceptance Amount Announcement of the Maximum Acceptance Amount for the Offers.	As soon as reasonably practicable following pricing of the New Notes and expected to be on 14 June 2024
Expiration Time Deadline for receipt by the Tender Agent of Tender Instructions. Qualifying Holders should note that Tender Instructions must be submitted in accordance with the deadlines of the Clearing System, which will be before the Expiration Time.	4.00 p.m. (London time) on 19 June 2024
Announcement of indicative results of the Offers Announcement by the Offeror of a non-binding indication of the level at which it expects to set the Series Acceptance Amounts and indicative pro-ration factors (if any) in the event the Offeror decides to accept Notes which have been validly Offered for Sale pursuant to the Offers.	As soon as reasonably practicable after the Expiration Time and expected to be on 20 June 2024
Pricing Time Determination of the 2025 Notes Interpolated Mid-Swap Rate, the 2026 Notes Interpolated Mid-Swap Rate, the 2025 Notes Repurchase Yield, the 2026 Notes Repurchase Yield, the 2025 Notes Purchase Price and the 2026 Notes Purchase Price.	At or around 11.00 a.m. (London time) on 20 June 2024
Announcement of the results of the Offers Announcement of (i) whether the Offeror will accept (subject to satisfaction or waiver of the New Financing Condition) any Notes pursuant to the Offers and, if so accepted, of the aggregate nominal amount of Notes of each Series so accepted for purchase, (ii) for any Series accepted for purchase, the pricing details, being, as applicable, the 2025 Notes Interpolated Mid-Swap Rate, the 2025 Notes Repurchase Yield, the 2025 Notes Purchase Price, the 2026 Notes Interpolated Mid-Swap Rate, the 2026 Notes Repurchase Yield and the 2026 Notes Purchase Price and (iii) the final Series Acceptance Amounts and pro-ration factors (if any) in respect of each Series.	As soon as reasonably practicable after the Pricing Time on 20 June 2024
Settlement Date Subject to satisfaction or waiver of the New Financing Condition on or prior to such date, settlement of the Offers. Payment of Tender Consideration in respect of Notes accepted for purchase.	Expected to be 24 June 2024

This is an indicative timetable and is subject to the right of the Offeror to extend, re-open, amend and/or terminate the Offers (subject to applicable law and as provided in the Tender Offer Memorandum). Announcements and notices to be given to Qualifying Holders in connection with the Offers will be made (i) by publication via the Regulatory News Service and (ii) by the delivery of notices to the Clearing Systems for communication to Direct Participants. Announcements may also be made by issue of a press release to one or more Notifying News Service(s). Copies of all such announcements, press releases and notices can also be obtained upon request from the Tender Agent.

Qualifying Holders are advised to check with any Intermediary through which they hold their Notes as to the deadlines by which such Intermediary would require receipt of instructions from Qualifying Holders to participate in, or to withdraw their instructions to participate in, the Offers in accordance with the terms and conditions of the Offers as described in the Tender Offer Memorandum in order to meet the relevant deadlines (which will be earlier than the deadlines set out above) and the corresponding deadlines set by the Clearing Systems.

Qualifying Holders are advised to read carefully the Tender Offer Memorandum for full details of, and information on the procedures for participating in, the Offers.

Barclays Bank PLC and J.P. Morgan Securities plc are acting as Dealer Managers for the Offers and Kroll Issuer Services Limited is acting as Tender Agent. For detailed terms of the Offers please refer to the Tender Offer Memorandum which (subject to offer and distribution restrictions) can be obtained from the Dealer Managers and the Tender Agent referred to below.

DEALER MANAGERS
Barclays Bank PLC 1 Churchill Place London E14 5HP United Kingdom Telephone: [phone] Attn: Liability Management Group Email: [e-mail]	J.P. Morgan Securities plc 25 Bank Street Canary Wharf London E14 5JP United Kingdom Telephone: [phone] Attn: EMEA Liability Management Group Email: [e-mail]
THE TENDER AGENT
Kroll Issuer Services Limited The Shard 32 London Bridge Street London SE1 9SG United Kingdom Tel: [phone] Attn: David Shilson Email: [e-mail] Website: https://deals.is.kroll.com/bt

This announcement is released by British Telecommunications public limited company and contains information that qualified or may have qualified as inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018, as amended ("UK MAR"), encompassing information relating to the Offers, as described above. For the purposes of UK MAR and the Implementing Technical Standards, this announcement is made by Andrew Binnie, BT Group Treasury Director of the Offeror.

DISCLAIMER

This announcement must be read in conjunction with the Tender Offer Memorandum. This announcement and the Tender Offer Memorandum contain important information which should be read carefully before any decision is made with respect to the Offers. If any Qualifying Holder is in any doubt as to the contents of this announcement, the Tender Offer Memorandum or the action it should take, it is recommended to seek its own financial, legal, regulatory and tax advice, including in respect of any tax consequences, immediately from its broker, bank manager, solicitor, accountant or other independent financial, tax or legal adviser.

None of the Offeror, the Dealer Managers or the Tender Agent or any of their respective directors, employees, officers, agents or affiliates expresses any opinion about the merits of the Offers or makes any recommendation as to whether or not any Qualifying Holder should offer to sell its Notes and no one has been authorised by the Offeror, the Dealer Managers or the Tender Agent to make any such recommendation.

OFFER RESTRICTIONS

UNITED STATES

The Offers are not being made, and will not be made, directly or indirectly in or into, or by use of the mails of, or by any means or instrumentality of interstate or foreign commerce of, or of any facilities of a national securities exchange of, the United States. This includes, but is not limited to, facsimile transmission, electronic mail, telex, telephone, the internet and other forms of electronic communication. The Notes may not be tendered in the Offers by any such use, means, instrumentality or facility from or within the United States or by persons located or resident in the United States as defined in Regulation S of the U.S. Securities Act of 1933, as amended (the "Securities Act").

Accordingly, copies of this announcement, the Tender Offer Memorandum and any other documents or materials relating to the Offers are not being, and must not be, directly or indirectly, mailed or otherwise transmitted, distributed or forwarded (including, without limitation, by custodians, nominees or trustees) in or into the United States. Any purported tender of Notes in the Offers resulting directly or indirectly from a violation of these restrictions will be invalid, and any purported tender of Notes made by a person located in the United States or any agent, fiduciary or other intermediary acting on a non-discretionary basis for a principal giving instructions from within the United States will be invalid and will not be accepted.

This announcement or the Tender Offer Memorandum is not an offer to buy or sell, or a solicitation of an offer to buy or sell, any Notes or other securities in the United States. Securities may not be offered or sold in the United States absent registration under, or an exemption from the registration requirements of, the Securities Act.

Each Holder of Notes participating in the Offers will represent that it is not a U.S. person, it is not located in the United States and it is not participating in the Offers from the United States or it is acting on a non-discretionary basis for a principal located outside the United States that is not giving an order to participate in the Offers from the United States.

For the purposes of this and above paragraphs, "United States" means the United States of America, its territories and possessions, any state of the United States of America and the District of Columbia.

UNITED KINGDOM

The communication of this announcement, the Tender Offer Memorandum and any other documents or materials relating to the Offers is not being made and such documents and/or materials have not been approved by an authorised person for the purposes of section 21 of the Financial Services and Markets Act 2000. Accordingly, such documents and/or materials are not being distributed to, and must not be passed on to, the general public in the United Kingdom. The communication of such documents and/or materials as a financial promotion is only being made to, and may only be acted upon by, those persons in the United Kingdom falling within the definition of investment professionals (as defined in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Financial Promotion Order")) or persons who are within Article 43 of the Financial Promotion Order or any other persons to whom it may otherwise lawfully be made under the Financial Promotion Order.

BELGIUM

None of this announcement, the Tender Offer Memorandum or any other documents or materials relating to the Offers have been submitted to or will be submitted for approval or recognition to the Belgian Financial Services and Markets Authority (Autorité des services et marchés financiers / Autoriteit financiële diensten en markten) and, accordingly, the Offers may not be made in Belgium by way of a public offering, as defined in Articles 3 and 6 of the Belgian Law of 1 April 2007 on public takeover bids (the "Belgian Takeover Law"), as amended or replaced from time to time. Accordingly, the Offers may not be advertised and the Offers will not be extended, and none of this announcement, the Tender Offer Memorandum or any other documents or materials relating to the Offers (including any memorandum, information circular, brochure or any similar documents) has been or shall be distributed or made available, directly or indirectly, to any individual or legal entity in Belgium other than (i) in reliance upon any private placement exemption set out in Article 6, §3 of the Belgian Takeover Law or (ii) in any circumstances set out in Article 6, §4 of the Belgian Takeover Law.

Insofar as Belgium is concerned, this announcement and the Tender Offer Memorandum have been issued only for the personal use of the above investors qualifying for the private placement exemption set out in Article 6, §3 of the Belgian Takeover Law and exclusively for the purpose of the Offers. Accordingly, the information contained in this announcement and the Tender Offer Memorandum may not be used for any other purpose or disclosed to any other person in Belgium.

FRANCE

This announcement, the Tender Offer Memorandum and any documents or offering materials relating to the Offers may not be distributed in the Republic of France except to qualified investors (investisseurs qualifiés) as defined in Article 2(e) of Regulation (EU) 2017/1129, as amended (the "Prospectus Regulation") and Article L.411-2 of the French Code monétaire et financier as amended from time to time. This announcement and the Tender Offer Memorandum have not been and will not be submitted for clearance to nor approved by the Autorité des marchés financiers.

REPUBLIC OF ITALY

None of the Offers, this announcement, the Tender Offer Memorandum or any other documents or materials relating to the Offers has been or will be submitted to the clearance procedures of the Commissione Nazionale per le Società e la Borsa ("CONSOB") pursuant to Italian laws and regulations. The Offers are being carried out in the Republic of Italy ("Italy") as exempted offers pursuant to article 101-bis, paragraph 3-bis of the Legislative Decree No. 58 of 24 February 1998, as amended (the "Financial Services Act") and article 35-bis, paragraph 4 of CONSOB Regulation No. 11971 of 14 May 1999, as amended. Holders or beneficial owners of the Notes that are located in Italy may tender their Notes in the Offers through authorised persons (such as investment firms, banks or financial intermediaries permitted to conduct such activities in Italy in accordance with the Financial Services Act, CONSOB Regulation No. 20307 of 15 February 2018, as amended from time to time, and Legislative Decree No. 385 of 1 September 1993, as amended) and in compliance with applicable laws and regulations or with requirements imposed by CONSOB or any other Italian authority.

Each intermediary must comply with the applicable laws and regulations concerning information duties vis-à-vis its clients in connection with the Notes and/or the Offers.

GENERAL

This announcement and the Tender Offer Memorandum do not constitute an offer to buy or the solicitation of an offer to sell Notes, and tenders of Notes for purchase pursuant to the Offers will not be accepted from Holders in any circumstances in which such offer or solicitation is unlawful.

NEW NOTES

Any investment decision to purchase any New Notes should be made solely on the basis of the information contained in (i) the prospectus dated 7 June 2024 prepared in connection with the €20,000,000,000 Euro Medium Term Note Programme of the Offeror (the "Prospectus") and (ii) the relevant final terms in respect of the New Notes pursuant to which the New Notes are intended to be issued, and no reliance is to be placed on any representations other than those contained in the Prospectus. Subject to compliance with all applicable securities laws and regulations, the Prospectus is available on the website of the Offeror and from the joint lead managers of the issue of the New Notes, on request.

The New Notes are not being, and will not be, offered or sold in the United States. Nothing in this announcement constitutes an offer to sell or the solicitation of an offer to buy the New Notes in the United States or any other jurisdiction. Securities may not be offered, sold or delivered in the United States absent registration under, or an exemption from the registration requirements of, the Securities Act. The New Notes have not been, and will not be, registered under the Securities Act or the securities laws of any state or other jurisdiction of the United States and may not be offered, sold or delivered, directly or indirectly, within the United States or to, or for the account or benefit of, U.S. persons (as defined in Regulation S under the Securities Act).

Compliance information for the New Notes: EEA MiFID II / UK MiFIR professionals / ECPs-only /No EEA or UK PRIIPs KID - Manufacturer target market (MiFID II / UK MiFIR product governance) is eligible counterparties and professional clients only (all distribution channels). No EEA or UK PRIIPs key information document (KID) has been prepared as not available to retail in EEA or UK. See the Prospectus for further information.

No action has been or will be taken in any jurisdiction in relation to the New Notes to permit a public offering of securities. The minimum denomination of the New Notes will be EUR 100,000.

 

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