8-KOther EventsExhibits & Filings

CENTENE CORP 8-K Report, Corporate Update (Dec 3, 2019)

Filed December 3, 2019For Securities:CNC

Summary

Centene Corporation (CNC) announced on December 3, 2019, an extension of the expiration date for its offers to exchange WellCare Health Plans, Inc. notes for new Centene notes and cash. The exchange offers and consent solicitations, originally set to expire on December 2, 2019, have been extended to December 18, 2019, with the possibility of further extensions. This move is part of Centene's ongoing integration efforts following its acquisition of WellCare. The primary purpose of these offers is to allow existing WellCare noteholders to exchange their current debt for Centene's debt, thereby simplifying the capital structure and potentially reducing financing costs post-merger. Notably, Centene has already received requisite consents from WellCare noteholders, leading to the execution of supplemental indentures that will remove most restrictive covenants and certain events of default from the governing indentures. These changes will become effective upon the settlement of the exchange offers.

Key Highlights

  • 1Centene extended the expiration date for its exchange offers and consent solicitations related to WellCare notes.
  • 2The new expiration date for the WellCare note exchange offers is December 18, 2019, with potential for further extensions.
  • 3The exchange offers involve WellCare notes being exchanged for up to $1.95 billion in new Centene notes and cash.
  • 4Centene has received the necessary consents to amend the indentures governing the WellCare Notes.
  • 5Supplemental indentures have been executed to eliminate substantially all restrictive covenants and certain events of default.
  • 6The elimination of covenants and defaults is contingent upon the settlement of the exchange offers.

Frequently Asked Questions

Centene extended the expiration date to provide WellCare noteholders with additional time to consider and participate in the exchange offers. This may be to encourage greater participation or to accommodate the integration process following the WellCare acquisition.

The execution of supplemental indentures is significant because it means Centene has secured the consent needed to remove most restrictive covenants and certain events of default from the existing WellCare notes' governing documents. This simplifies the debt structure and potentially provides Centene with more financial flexibility once the exchange offers settle.

The changes to the WellCare note indentures, including the elimination of restrictive covenants and certain events of default, will only become operative upon the settlement date of the exchange offers. This means the full benefits of these amendments are realized once the debt has been exchanged.

Centene is offering up to $1,950,000,000 in aggregate principal amount of new notes to be issued by Centene, along with cash, in exchange for the WellCare Notes.