An Overview of Banco Bilbao's Bond Purchase Offer Strategy

Understanding the Bond Purchase Offer

Banco Bilbao Vizcaya Argentaria, S.A., in collaboration with Banco Santander, S.A., BNP Paribas Securities Corp., Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, and J.P. Morgan Securities plc, has launched a significant offer to purchase existing bonds from holders. This initiative aims to enhance their positions in the market and manage their future obligations with greater efficiency.

The Offer Overview

The bond purchase offer invites registered holders or beneficiaries of the bonds to participate for cash consideration. The offer encompasses various existing bonds, with the purchase price determined by the Purchasers at their discretion, known as the Maximum Purchase Price. This structured approach allows for flexibility while securing the required capital to optimize their investment strategies.

Details of the Purchase Price and Accrued Interest

For each bond series accepted under this offer, holders will be compensated with a fixed price per $1,000 principal amount. Furthermore, accumulated and unpaid interest will be provided to those whose bonds are accepted, enhancing the attractiveness of the offer.

Understanding the Bond Series and Pricing

The existing bonds included in the offer span a range of pricing and maturity dates, each with unique identifiers such as CUSIP/ISIN numbers. For instance, the 3.875% Global Bonds due 2027 have an outstanding principal amount of $1,740,144,000, with a corresponding purchase price of $996.25.

Proration Factor Considerations

Should the total purchase price for all valued tenders exceed the Maximum Purchase Price for a bond series, the Purchasers reserve the right to implement a proration factor. This ensures an equitable allocation among all bondholders who tender their securities.

Operational Procedures for Tendering Bonds

To participate, bondholders must submit their tenders through a direct participant in the Depository Trust Company. It’s critical for those with assets held via a custodian to coordinate with their intermediaries to facilitate tender submissions effectively.

Timeline for the Offer

The offer commenced on a specified date and is expected to remain open for a limited window, with set times for withdrawals and the final settlement. It is essential for holders to act within the established timelines to ensure their participation.

End Goals of the Offer

This bond purchase strategy serves a dual purpose: bolstering the financial health of the participating banks and hedging against potential obligations linked to total return swaps with the Republic. The success of this initiative will be contingent upon meeting the conditions outlined in the offer document.

Contact Information for Queries

For inquiries regarding the bond purchase offer, holders can reach out to Global Bondholder Services Corporation, ensuring they have the necessary information to make informed decisions.

Frequently Asked Questions

What is the purpose of the bond purchase offer?

The bond purchase offer aims to allow institutional investors to acquire existing bonds and manage their portfolios effectively.

How is the purchase price determined?

The purchase price is fixed for each series based on the Purchasers' discretion, considering the overall market conditions.

Can bondholders withdraw their tenders?

Yes, holders can withdraw their tenders before the set withdrawal deadline.

What are the conditions for participating in the offer?

Participation requires submitting tenders through accredited participants, and holders must comply with any legal restrictions surrounding the offer.

Where can holders find more information about the offer?

Further details can be obtained from the Tender and Information Agent or through the specified offer document.

About The Author

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