Citigroup Inc. ("Citigroup") today announced the commencement of its offer to purchase for cash up to U.S. $700 million aggregate principal amount (the "Maximum Tender Cap") of its outstanding 6.125% Notes due 2017 (the "Notes"). The offer to purchase the Notes is referred to as the "Offer." The Notes had an aggregate principal amount outstanding of U.S. $3,865,935,000 as of August 21, 2014.
The Offer is consistent with Citigroup's liability management strategy, and reflect its ongoing efforts to enhance the efficiency of its funding and capital structure. Since 2013, Citigroup redeemed or retired approximately U.S. $19.6 billion of securities, excluding exchanged securities, of which approximately U.S. $7.3 billion was redeemed or retired in 2014, reducing Citigroup's overall funding costs. Citigroup will continue to consider opportunities to redeem or repurchase securities, based on several factors, including without limitation, the economic value, potential impact on Citigroup's net interest margin and borrowing costs, the overall remaining tenor of Citigroup's debt portfolio, capital impact, as well as overall market conditions.
The Offer is being made pursuant to the offer to purchase, dated August 22, 2014 (the "Offer to Purchase," as may be amended or supplemented from time to time), and the related letter of transmittal (the "Letter of Transmittal," as may be amended or supplemented from time to time) which set forth in more detail the terms and conditions of the Offer.
The Offer will expire at 11:59 p.m., New York City time, on September 19, 2014, unless extended or earlier terminated (such date and time, as the same may be extended, the "Expiration Date"). Subject to the terms and conditions set forth in the Offer to Purchase and the Letter of Transmittal, Holders of Notes that are validly tendered on or prior to 5:00 p.m., New York City time, on September 5, 2014, unless extended (such date and time, as the same may be extended, the "Early Tender Date") and accepted for purchase shall be entitled to receive the total consideration calculated in the manner set forth in the Offer to Purchase (the "Total Consideration"), which includes an early tender premium in the amount indicated in the table above (the "Early Tender Premium"). The Total Consideration with respect to the Notes will be equal to the price, determined in accordance with standard market practice, as described in the Offer to Purchase, that equates to a yield to maturity equal to the fixed spread of 82 basis points over the yield, which shall be based on the bid-side price of the 0.875% U.S. Treasury Note due August 15, 2017, at 2:00 p.m., New York City time, on September 8, 2014 (subject to certain exceptions set forth in the Offer to Purchase, such time and date, as the same may be extended, the "Price Determination Date").