Republic of Chile - Announcement of Tender Offer

SANTIAGO, Chile, May 8, 2019 /PRNewswire/ -- Chile announced today the commencement of an offer to purchase for cash (the "Tender Offer") debt securities of the series listed in the table below (the "Old Bonds" and each Old Bonds, a "series" of Old Bonds). The aggregate Purchase Price (as defined below) to be paid for the Old Bonds tendered and accepted for purchase pursuant to the Tender Offer will be determined by Chile in its sole discretion (the "Maximum Purchase Amount"). The terms and conditions of the Tender Offer are set forth in an offer to purchase, dated Wednesday, May 8, 2019, 2019 (the "Offer to Purchase").  The Tender Offer is being made concurrently with an offer to exchange Local Bonds (as defined below) for New Bonds (as defined below) to the public in Chile.

The Tender Offer is not conditioned upon any minimum participation of any series of Old Bonds, but is conditioned on the pricing and closing of a global offering that consists of an offering to the public in Chile, and an offer and sale of bonds to investors outside of Chile pursuant to Rule 144A and Regulation S of the Securities Act of 1933, as amended, of Chile's existing Chilean Peso-denominated 4.00% Bonds due March 1, 2023 (the "2023 Bonds"), 4.70% Bonds due September 1, 2030 (the "2030 Bonds") and 5.10% Bonds due July 15, 2050 (the "2050 Bonds" and, together with the 2023 Bonds and the 2030 Bonds the "New Bonds") in an amount, with pricing and on terms and conditions acceptable to Chile in its sole discretion, with pricing terms expected to be announced on or about Wednesday, May 15, 2019 (such offering of New Bonds to investors outside of Chile the "New Bonds Offering").

The Tender Offer commenced at 8:00 a.m., New York time, on Wednesday, May 8, 2019 and, unless extended or earlier terminated by Chile in its sole discretion, will expire at 8:00 a.m., New York time, on Wednesday, May 15, 2019 (the "Tender Period").  Subject to pricing and closing of the New Bonds Offering and the other terms and conditions set forth in the Offer to Purchase, and subject to change by Chile, the settlement of the Tender Offer is expected to occur on Friday, May 17, 2019 (the "Tender Offer Settlement Date"). 

At or around 6:00 p.m., New York time, on Monday, May 13, 2019, or as soon as possible thereafter, Chile will announce the purchase price per Ps. 1,000,000 principal amount of Old Bonds of each series (the "Purchase Price").  Payment for any tendered Old Bonds accepted by Chile, together with an amount in cash corresponding to accrued and unpaid interest, accrued at the rates contemplated in each series of Old Bonds to but excluding the Tender Offer Settlement Date, will be made after and conditioned upon the pricing and closing of the New Bonds Offering. Payment of the Purchase Price and accrued interest for Old Bonds accepted for purchase in the Offer will be made in U.S. dollars, calculated at the Observado rate published in the Diario Oficial on Wednesday, May 15, 2019, which is the same rate at which New Bonds sold in the New Bonds Offering will be converted to U.S. dollars. Holders of 2020 Bonds are advised that the exchange rate used to calculate accrued interest in U.S. dollars is different from the rate set forth in the terms and conditions of the 2020 Bonds.

You may only submit tenders through Euroclear System ("Euroclear"), Clearstream Banking, société anonyme, Luxembourg ("Clearstream"). You will NOT be able to submit tenders through the Depository Trust Company ("DTC") or Depósito Central de Valores S.A., Depósito de Valores ("DCV").

You must comply with the applicable procedures of Euroclear and Clearstream including arranging for a direct participant in Euroclear or Clearstream to deliver a valid electronic acceptance instruction ("Electronic Acceptance Instruction"), which includes the proper blocking and debit irrevocable instructions, to Euroclear or Clearstream, as applicable.

If you are a beneficial owner whose Old Bonds are held by a broker, dealer, commercial bank, trust company or other nominee (each, a "Nominee") and you desire to tender the Old Bonds in the Tender Offer, you must contact your Nominee and instruct such Nominee, as holder of the Old Bonds, to tender the Old Bonds on your behalf. The deadlines set by Euroclear, Clearstream or any such intermediary for the submission of tenders of Old Bonds may be earlier than the relevant deadlines specified in the Offer to Purchase.

For further information on the procedures to tender Old Bonds, please refer to the Offer to Purchase and/or call the Tender and Information Agent at its telephone numbers set forth below or consult your Nominee for assistance.

Valid tenders made in accordance with the terms and conditions of the Offer ("Tender Orders") may be withdrawn on or prior to 8:00 a.m., Wednesday, May 15, 2019 (the "Withdrawal Deadline"), unless the Withdrawal Deadline is extended or earlier terminated. A valid withdrawal of Old Bonds on or prior to the Withdrawal Deadline will result in the holder not being eligible to receive the Purchase Price or any accrued interest pursuant to the Tender Offer.

Tender Orders may be subject to proration.  Chile may prorate Tender Orders for each series of Old Bonds differently, in its sole discretion. If Tender Orders of a series are subject to proration, Chile will give priority to Tender Orders of tendering holders that quote an allocation identifier code, but only to the extent that the Purchase Price and accrued interest of such Tender Orders (together with the Purchase Price and accrued interest of Tender Offers of Old Bonds of any other series) does not exceed the purchase price of the aggregate principal amount of any New Bonds actually allocated to and purchased by such tendering holder in the New Bonds Offering. Tendering holders that intend to subscribe for New Bonds can obtain an allocation identifier code by contacting any of the Dealer Managers.

At or around 8:00 a.m., New York time, on Thursday, May 16, 2019, or as soon as possible thereafter, Chile will announce the Maximum Purchase Amount for each series, the aggregate principal amount of Preferred Tenders (as defined below) and, if any, Non-Preferred Tenders (as defined below) of each series of Old Bonds that has been accepted, whether any Tender Orders will be prorated and the exchange rate at which the Purchase Price and any accrued interest for Old Bonds accepted for purchase will be calculated.

"Preferred Tenders" means the Tender Orders for a series of Old Bonds submitted by a holder that also submits a corresponding indication of interest in the New Bonds Offering and has obtained and transmitted an allocation identifier code, but only to the extent that the Purchase Price and accrued interest of such Tender Orders (together with the Purchase Price and accrued interest of Tender Orders of Old Bonds of any other series) does not exceed the purchase price of the aggregate principal amount of any New Bonds actually allocated to and purchased by such tendering holder in the New Bonds Offering. The balance, if any, of such Tender Order will constitute a Non-Preferred Tender, as described below.

"Non-Preferred Tender" means any Tender Order (or portion thereof) that is not a Preferred Tender. Non-Preferred Tenders include, among others, Tender Orders submitted by a holder that does not submit a corresponding Indication of Interest in the New Bonds Offering as well as the portion of any Tender Order received (with a corresponding Indication of Interest in the New Bonds Offering) that would not constitute a Preferred Tender.

If the aggregate Purchase Price of all Preferred Tenders for a series is equal to the Maximum Purchase Amount applicable to such series then all Preferred Tenders shall be accepted for such series and no Non-Preferred Tenders shall be accepted for such series. If the aggregate Purchase Price of all Preferred Tenders for a series is less than the Maximum Purchase Amount applicable to such series then (i) all Preferred Tenders shall be accepted for such series, and, (ii) with respect to the portion of the Maximum Purchase Amount remaining after the acceptance of all Preferred Tenders for such series, each tendering holder shall have its Non-Preferred Tenders for such series of Old Bonds prorated down, proportionate to the relative size of each such holder's Non-Preferred Tenders of that series of Old Bonds to all Non-Preferred Tenders, subject to any adjustments, if necessary, to avoid purchase of the Old Bonds in principal amounts other than minimum denominations.

The Tender Offer is subject to Chile's right, in its sole discretion, to extend, terminate, withdraw or amend its terms at any time.  Chile reserves the right, in its sole discretion not to accept any Tender Orders, or to accept Tender Orders as to one or more series of Old Bonds but no other series, for any reason. 

The Offer to Purchase may be downloaded from the Tender and Information Agent's website at https://www.gbsc-usa.com/chile/ or obtained from the Tender and Information Agent, Global Bondholder Services Corporation in New York, at 65 Broadway – Suite 404, New York, NY 10006 (Banks and Brokers call collect: (212) 430-3774; all others call Toll-Free: (866)-470-4500) Attention:  Corporate Actions (e‑mail: [email protected]), or from any of the Dealer Managers.

The Dealer Managers for the Tender Offer are:

NONE OF CHILE, THE DEALER MANAGERS OR THE TENDER AND INFORMATION AGENT MAKES ANY RECOMMENDATION THAT ANY HOLDER TENDER OR REFRAIN FROM TENDERING ALL OR ANY PORTION OF THE PRINCIPAL AMOUNT OF SUCH HOLDER'S OLD BONDS OR THAT ANY HOLDER SUBMIT OR CHOOSE NOT TO SUBMIT AN INDICATION OF INTEREST IN THE NEW BONDS IN CONNECTION WITH SUCH A TENDER, AND NO ONE HAS BEEN AUTHORIZED BY ANY OF THEM TO MAKE SUCH A RECOMMENDATION. HOLDERS MUST MAKE THEIR OWN DECISIONS WHETHER TO TENDER OLD BONDS, AND, IF SO, THE PRINCIPAL AMOUNT OF OLD BONDS TO TENDER AND WHETHER TO SUBMIT AN INDICATION OF INTEREST IN THE NEW BONDS IN CONNECTION WITH SUCH A TENDER.

Important Notice

The New Bonds Offering will be made solely by means of an offering memorandum relating to that offering, and this announcement does not constitute an offer to sell or the solicitation of an order to buy any New Bonds.  You may not participate in the New Bonds Offering unless you have received and reviewed the offering memorandum related to that offering, and not in reliance on, or on the basis of, this announce or the Offer to Purchase. The New Bonds will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act") or the securities laws of any other jurisdiction and will be offered in the United States only to qualified institutional buyers in accordance with Rule 144A under the Securities Act and to non-U.S. persons outside the United States in reliance on Regulation S under the Securities Act.

This announcement is not an offer to purchase or a solicitation of an offer to sell the Old Bonds. The Tender Offer will be made only by and pursuant to the terms of the Offer to Purchase, as may be amended or supplemented from time to time.

The distribution of materials relating to the New Bonds Offering and the Tender Offer, and the transactions contemplated by the New Bonds Offering and Tender Offer, may be restricted by law in certain jurisdictions.  The Tender Offer is made only in those jurisdictions where it is legal to do so.  The Tender Offer is void in all jurisdictions where it is prohibited.  If materials relating to the New Bonds Offering or the Tender Offer come into your possession, you are required to inform yourself of and to observe all of these restrictions.  The materials relating to the New Bonds Offering and the Tender Offer, including this communication, do not constitute, and may not be used in connection with, an offer or solicitation in any place where offers or solicitations are not permitted by law. If a jurisdiction requires that the New Bonds Offering or the Tender Offer be made by a licensed broker or dealer and a Dealer Manager or any affiliate of a Dealer Manager is a licensed broker or dealer in that jurisdiction, the New Bonds Offering or the Tender Offer, as the case may be, shall be deemed to be made by the Dealer Manager or such affiliate in that jurisdiction.  Owners who may lawfully participate in the Tender Offer in accordance with the terms thereof are referred to as "holders."

This announcement and the offer to purchase contains forward-looking statements.  Forward-looking statements are statements that are not historical facts, including statements about Chile's beliefs and expectations. These statements are based on current plans, estimates and projections, and therefore you should not place undue reliance on them. Forward-looking statements speak only as of the date they are made. Chile undertakes no obligation to update any of them in light of new information or future events.  Forward-looking statements involve inherent risks and uncertainties. Chile cautions you that a number of important factors could cause actual results to differ materially from those contained in any forward-looking statement.

ANY DISCLAIMERS OR OTHER NOTICES THAT MAY APPEAR AFTER THIS MESSAGE ARE NOT APPLICABLE TO THIS COMMUNICATION AND SHOULD BE DISREGARDED.  SUCH DISCLAIMERS OR OTHER NOTICES WERE AUTOMATICALLY GENERATED AS A RESULT OF THIS COMMUNICATION BEING SENT VIA BLOOMBERG OR ANOTHER EMAIL SYSTEM.

SOURCE Republic of Chile