Summary
Elevance Health, Inc. (then operating as WellPoint, Inc.) filed this Form 8-K on July 31, 2013, to report on significant financing activities undertaken on July 30, 2013. The company entered into an Underwriting Agreement to issue and sell $650 million of 2.300% Notes due 2018 and $600 million of 5.100% Notes due 2044. The total principal amount of notes issued is $1.25 billion. These new notes were issued to fund the company's cash tender offers for its outstanding notes, with remaining proceeds intended for general corporate purposes, including other debt repurchases. This move indicates a proactive approach to managing its capital structure and debt obligations, potentially optimizing its cost of capital and financial flexibility.
Key Highlights
- 1WellPoint, Inc. (now Elevance Health) issued $650 million in 2.300% Notes due 2018 and $600 million in 5.100% Notes due 2044, totaling $1.25 billion in new debt.
- 2The primary purpose of the note issuance was to finance cash tender offers for existing outstanding notes.
- 3Proceeds not used for tender offers will be allocated to general corporate purposes, including potential repurchases of other outstanding indebtedness.
- 4The company entered into an Underwriting Agreement with Morgan Stanley & Co. LLC and Citigroup Global Markets Inc. as representatives for the underwriters.
- 5Interest on the new notes will be paid semi-annually in arrears on January 15 and July 15, commencing January 15, 2014.
- 6The notes include provisions for redemption at the company's option and a change of control provision that may trigger a mandatory offer to purchase the notes.
- 7The filing also announced the commencement of cash tender offers for up to $600 million aggregate principal amount of outstanding notes.
Frequently Asked Questions
WellPoint, Inc. raised a total of $1.25 billion through the issuance of new notes: $650 million aggregate principal amount of 2.300% Notes due 2018 and $600 million aggregate principal amount of 5.100% Notes due 2044.
The proceeds from the sale of the new notes are primarily intended to fund the purchase price of outstanding notes being tendered and accepted in the company's cash tender offers. Any remaining net proceeds will be used for general corporate purposes, including the repurchase of other outstanding indebtedness.
The 2.300% Notes due 2018 mature on July 15, 2018, and the 5.100% Notes due 2044 mature on January 15, 2044. Interest is payable semi-annually on January 15 and July 15.
Yes, the notes include a provision that, upon the occurrence of both a change of control of the company and a downgrade of the notes below investment grade by major rating agencies within a specified period, the company will be required to make an offer to purchase all of the notes at 101% of their principal amount, plus accrued interest.