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Telefonica Europe (51XL)

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Thursday 19 November, 2015

Telefonica Europe

Deed of Covenant in relation to Hybrid Securities

RNS Number : 3054G
Telefonica Europe B.V.
19 November 2015
 

 

Telefónica Europe B.V.

(the "Issuer")

EUR 1,125,000,000 Undated 5 Year Non-Call Deeply Subordinated Guaranteed Fixed Rate Reset Securities (XS0972570351)

EUR 625,000,000 Undated 8 Year Non-Call Deeply Subordinated Guaranteed Fixed Rate Reset Securities (XS0972588643)

GBP 600,000,000 Undated 7 Year Non-Call Deeply Subordinated Guaranteed Fixed Rate Reset Securities (XS0997326441)

EUR 750,000,000 Undated 6 Year Non-Call Deeply Subordinated Guaranteed Fixed Rate Reset Securities (XS1050460739)

EUR 1,000,000,000 Undated 10 Year Non-Call Deeply Subordinated Guaranteed Fixed Rate Reset Securities (XS1050461034)

and EUR 850,000,000 Undated 5 Year Non-Call Deeply Subordinated Guaranteed Fixed Rate Reset Securities (XS1148359356)

In each case guaranteed by Telefónica, S.A. ("the Guarantor")

(together the "Securities")

 

19 November 2015

On 27 October 2015 Standard and Poor's ("S&P") issued a press release stating that it had assigned minimal equity content to the Securities as a result of certain call provisions contained within the terms and conditions of the Securities (the "Conditions"). 

The Issuer and the Guarantor have therefore entered into a deed of covenant dated 18 November 2015 ("Deed of Covenant") in order to waive the Issuer's right to require the early redemption of the Securities in certain circumstances. 

The Issuer and the Guarantor have irrevocably undertaken that the Issuer will not redeem the Securities upon the occurrence of a "Capital Event" in circumstances where the Securities will no longer be eligible for the same or a higher amount of "equity credit" that was attributed to the Securities at their issue date as a result of the application of a different hybrid capital methodology or set of criteria by a relevant rating agency (due to changes in the rating previously assigned to the Issuer and/or the Guarantor or to any other reasons).

Save as expressly stated above, the Deed of Covenant does not in any way alter or affect the Issuer's right to redeem the Securities, including, without limitation, upon the occurrence of any of the other Capital Event as specified in the Conditions.

The Issuer and the Guarantor expect S&P to reverse the revision of the Securities and restore the "intermediate" equity content.

The Deed of Covenant will be available for inspection by holders of the Securities at the specified offices of the Fiscal Agent. 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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