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Berkshire Hathaway Energy, subsidiary launch up to $1B cash tender offer

Berkshire Hathaway Energy and its MidAmerican Funding LLC subsidiary on Dec. 13 launched a cash tender offer to purchase up to $1 billion of certain series of their outstanding senior bonds, plus accrued and unpaid interest.

The tender offer is for MidAmerican Funding's 6.927% bonds due 2029, and for Berkshire Hathaway Energy's 8.480% bonds due 2028, its 6.50% bonds due 2037, its 6.125% bonds due 2036 and its 5.950% bonds due 2037, according to a Form 8-K filing.

The companies will purchase the bonds based on the priority order for each series, with 1 being the highest acceptance priority level for the 6.927% bonds and 5 being the lowest acceptance priority level for the 5.950% bonds.

Concurrently, the companies are soliciting consents from each holder of the bonds to modify or eliminate substantially all of the restrictive covenants, certain events of default and related provisions contained in the indentures governing each series of bonds.

The tender offer will expire at 11:59 p.m. ET on Jan. 11, 2018, unless extended or unless earlier terminated. The consent solicitation will expire at 11:59 p.m. ET on Jan. 11, 2018, unless extended or earlier terminated.

Holders who validly tender and not validly withdraw their bonds at or prior to 5:00 p.m. ET on Dec. 27 will be eligible to receive a total consideration of about $1,347.16 per $1,000 principal amount of the 6.927% bonds, $1,474.97 per $1,000 principal amount of the 8.48% bonds, $1,399.57 per $1,000 principal amount of the 6.50% bonds, $1,345.18 per $1,000 principal amount of the 6.125% bonds, and $1,318.95 per $1,000 principal amount of the 5.950% bonds, the companies said.

The total consideration includes an early tender premium of $30.00 per $1,000 of principal amount of bonds accepted for purchase.

Holders of Bonds who tender their bonds after the early tender date, but at or prior to the expiration date, will be eligible to receive only the applicable tender offer consideration, according to the filing.

Bonds tendered in the tender offer and consents delivered in the consent solicitation may be validly withdrawn or revoked at any time at or prior to 5 p.m. ET on Dec. 27.

The early settlement date for the bonds is anticipated to be Dec. 29, and the final settlement date for the bonds is anticipated to be Jan. 12, 2018.

Citigroup Global Markets Inc. is acting as the dealer manager for the tender offer and solicitation agent for the consent solicitation.

Berkshire Hathaway Energy is a Berkshire Hathaway Inc. subsidiary.