8-KOther EventsExhibits & Filings

Elevance Health, Inc. 8-K Report, Corporate Update (Mar 2, 2018)

Filed March 2, 2018For Securities:ELV

Summary

Elevance Health, Inc. (formerly Anthem, Inc.) reported on March 2, 2018, the closing of a significant debt offering. The company sold $850 million of 4.550% Notes due 2048, while selling securityholders sold $1.250 billion of 4.101% Notes due 2028. The company received net proceeds of approximately $835.2 million from its issuance of the 2048 Notes, which it intends to use for general corporate purposes, including debt repayment, share repurchases, and potential acquisitions. The 2028 Notes offering did not directly provide proceeds to the company, as it involved the exchange of existing subordinated notes. This transaction reflects the company's strategy to manage its capital structure and fund future growth initiatives. The debt offering was conducted under an underwriting agreement with major financial institutions and is registered under the Securities Act of 1933. The notes carry specific interest rates and maturity dates, with provisions for semi-annual interest payments and terms for redemption and potential repurchase in the event of a change of control and rating downgrade for the 2048 Notes. Investors should note the differing use of proceeds and the absence of a change of control repurchase obligation for the 2028 Notes.

Key Highlights

  • 1Elevance Health (then Anthem, Inc.) closed a notes offering on March 2, 2018.
  • 2The company issued $850 million in aggregate principal amount of 4.550% Notes due 2048.
  • 3Selling securityholders sold $1.250 billion in aggregate principal amount of 4.101% Notes due 2028.
  • 4The company received net proceeds of approximately $835.2 million from the sale of the 2048 Notes.
  • 5Proceeds from the 2048 Notes are designated for working capital, debt repayment, share repurchases, and acquisitions.
  • 6The 2048 Notes include provisions for redemption and a change of control repurchase requirement under specific conditions.
  • 7The 2028 Notes do not have a change of control repurchase obligation.

Frequently Asked Questions

This 8-K filing was made to report on the closing of a significant debt offering by Elevance Health (then Anthem, Inc.). It details the issuance of new notes and the terms associated with them.

Elevance Health directly raised approximately $835.2 million in net proceeds from the sale of its 4.550% Notes due 2048. The sale of the 4.101% Notes due 2028 by selling securityholders did not provide direct proceeds to the company.

The company intends to use the net proceeds from the 2048 Notes for working capital and general corporate purposes. This includes, but is not limited to, repaying short-term and long-term debt, repurchasing its common stock under its share repurchase program, and funding potential acquisitions.

The 2028 Notes have a lower interest rate (4.101%) and an earlier maturity date (2028) compared to the 2048 Notes (4.550% interest rate, 2048 maturity). Notably, the 2048 Notes have specific redemption terms and a provision requiring the company to offer to repurchase them at 101% of their principal amount if a change of control occurs coupled with a credit rating downgrade, whereas the 2028 Notes do not have this change of control repurchase obligation.