8-KOther EventsExhibits & Filings

CENTENE CORP 8-K Report, Corporate Update (Feb 10, 2021)

Filed February 10, 2021For Securities:CNC

Summary

Centene Corporation (CNC) announced on February 10, 2021, a significant financial maneuver involving a new senior notes offering and the concurrent repurchase or redemption of its existing 4.75% Senior Notes due 2025. The company is offering $2.2 billion in new senior notes due 2031. The primary purpose of this new debt issuance is to fund the purchase price for the existing 4.75% Notes that are tendered and accepted in a simultaneous tender offer, and to redeem any of those notes that remain outstanding after the tender offer. This strategic move aims to refinance existing debt, potentially at a more favorable interest rate or maturity profile, and to manage its outstanding debt obligations proactively. Investors should note that the consummation of the tender offer is conditional upon the successful completion of the new senior notes offering, and the redemption of any remaining 4.75% Notes is conditional upon the closing of the new offering. The press release also indicates that risk factors associated with the offering have been disclosed, which investors should review.

Key Highlights

  • 1Centene Corp (CNC) launched a $2.2 billion offering of senior notes due 2031.
  • 2The company commenced a tender offer to purchase any and all of its outstanding 4.75% Senior Notes due 2025.
  • 3Proceeds from the new notes offering will be used to fund the repurchase and redemption of the 4.75% Senior Notes due 2025.
  • 4A conditional redemption notice has been issued for any 4.75% Notes not purchased in the tender offer, with a redemption date of March 12, 2021.
  • 5The redemption price for the 4.75% Notes is set at $1,023.75 per $1,000 principal amount, plus accrued interest.
  • 6Both the tender offer and the redemption are contingent upon the successful closing of the new senior notes offering.
  • 7Associated risk factors for the offering have been disclosed and incorporated by reference.

Frequently Asked Questions

The main purpose of the $2.2 billion senior notes offering due 2031 is to raise capital to fund the purchase price of Centene's existing 4.75% Senior Notes due 2025 that are accepted in a tender offer, and to redeem any remaining 4.75% Notes that are not tendered. This is a debt refinancing transaction.

Centene is conducting a tender offer to buy back these notes and has also issued a conditional notice to redeem any notes that are not purchased through the tender offer. The redemption date is March 12, 2021, and the redemption price is $1,023.75 per $1,000 principal amount plus accrued interest.

No, both the tender offer and the redemption are conditional. They are contingent upon the successful completion (closing) of the new $2.2 billion senior notes offering by Centene. If the new offering does not close, these actions regarding the 4.75% Notes may not proceed as planned.

Detailed risk factors associated with this senior notes offering have been disclosed and are incorporated by reference in the filing, typically found in the preliminary prospectus supplement. These are available as Exhibit 99.3 to this Form 8-K.