01—Abstract
Summary
Summary of the 8-K filed February 7, 2025. Cited figures are marked; the original filing is the authoritative source.
FedEx Corporation (FDX) filed an 8-K on February 7, 2025 announcing that it extended the expiration date of its exchange offers and consent solicitations for a broad set of senior notes from February 6, 2025 to February 21, 2025 (5:00 p.m.
New York City time). The exchange offers and consents are tied to the proposed separation of FedEx Freight into a new publicly traded company. The Proposed Amendments would release the guarantee of FedEx Freight, Inc. automatically when it ceases to be a FedEx subsidiary in connection with the Separation.
The filing states that the Separation is not conditioned on the completion of the exchange offers or consent solicitations, and vice versa. As of the prior expiration date, FedEx had received the requisite consents to adopt the amendments for 19 series of notes, which it labels the Majority Existing Notes, covering both U.S. dollar and euro-denominated issues. Consents had not yet reached the required threshold for three series, labeled the Non-Majority Existing Notes: the 4.200%a notes due 2028, the 4.250% notes due 2030, and the 1.300% euro notes due 2031.
Tender levels for those three series ranged from roughly 29%b to 48% of principal outstanding, so they remain the open question for the amendments. FedEx also amended terms for four series (3.875% due 2042, 4.050% due 2048, 4.950% due 2048 and 5.250% due 2050). Holders who tender these notes after the prior expiration date will receive the New Notes exchange consideration but no longer the cash early participation payment.
Holders of the Non-Majority series who tender in the extended window keep the full total consideration, including the cash payment. The New Notes are unregistered under the Securities Act and are offered only to eligible holders. For investors, the filing is primarily a debt-management and separation-preparation disclosure rather than an earnings or operating update.
02—Key points
Key Highlights
- FedEx extended the expiration date of its notes exchange offers and consent solicitations from February 6, 2025 to February 21, 2025 at 5:00 p.m. NYC time.
- Requisite consents were received for 19 series of notes (the Majority Existing Notes), covering both USD and EUR issues, to adopt amendments releasing the FedEx Freight, Inc. guarantee upon separation.
- Consents were not yet received for three series (4.200% due 2028, 4.250% due 2030, and 1.300% due 2031), with tender levels of 48.00%, 44.62% and 29.02% respectively as of the prior expiration date.
- Holders tendering the 3.875% due 2042, 4.050% due 2048, 4.950% due 2048 and 5.250% due 2050 notes after the prior expiration date lose the cash early participation payment ($2.50 per $1,000 or €2.50 per €1,000), though they still receive the New Notes exchange consideration.
- The Separation (a spin-off or other disposition of FedEx Freight through the capital markets) is not conditioned on the exchange offers, and the exchange offers are not conditioned on the Separation.
- The new notes are unregistered under the Securities Act and may only be offered to qualified institutional buyers or eligible non-U.S. persons.
- The exchange offers were launched under an offering memorandum dated January 7, 2025, and the Early Participation Date was January 22, 2025.
03—Questions
Frequently Asked Questions
What is the purpose of the exchange offers and consent solicitations?
FedEx is seeking holder consent to amend the indentures of its senior notes so that the guarantee from FedEx Freight, Inc. is automatically and unconditionally released when FedEx Freight ceases to be a FedEx subsidiary in connection with the planned Separation. The offers also exchange existing notes for new notes.
Why did FedEx extend the expiration date?
The filing does not state a specific reason. The extension to February 21, 2025 gave holders more time to tender, particularly for the three series that had not yet reached the required consent threshold.
Did the amendments pass for all outstanding notes?
Not yet for every series. Requisite consents were received for 19 series (Majority Existing Notes). Consents for the 4.200% notes due 2028, 4.250% notes due 2030 and 1.300% notes due 2031 had not been obtained as of the prior expiration date.
Does this affect the cash payment for noteholders?
Yes, for certain series. Holders who tender the 3.875% due 2042, 4.050% due 2048, 4.950% due 2048 and 5.250% due 2050 notes after February 6, 2025 will no longer receive the cash early participation payment, though they still receive New Notes. Holders of the Non-Majority Existing Notes who tender in the extended window keep the full total consideration, including the cash portion.
Is the Separation of FedEx Freight dependent on these exchange offers?
No. The filing states that the Separation is not conditioned on the completion of any exchange offer or consent solicitation, and none of the exchange offers or consent solicitations is conditioned on the Separation.
04—Continue