SOURCE: Duke Realty Corporation

Duke Realty Corporation

April 02, 2015 09:14 ET

Duke Realty Announces Early Tender Results of Its Debt Tender Offer

INDIANAPOLIS, IN--(Marketwired - Apr 2, 2015) - Duke Realty Corporation (NYSE: DRE), a leading industrial and medical office property REIT, today announced the early tender results of the previously announced tender offer (the "Tender Offer") of its operating partnership, Duke Realty Limited Partnership ("Duke Realty"), to purchase for cash for a combined aggregate purchase price (exclusive of accrued and unpaid interest) of up to $500,000,000 (the "Maximum Tender Amount") its 8.25% Senior Notes due 2019 (CUSIP No.: 26441YAT4) (the "2019 Notes"), its 5.95% Senior Notes due 2017 (CUSIP No.: 26441YAM9) (the "2017 Notes"), its 6.75% Senior Notes due 2020 (CUSIP No.: 26441YAU1) (the "2020 Notes"), its 6.50% Senior Notes due 2018 (CUSIP No.: 26441YAQ0) (the "2018 Notes") and its 4.375% Senior Notes due 2022 (CUSIP No.: 26441YAV9) (the "2022 Notes"). The 2019 Notes, the 2017 Notes, the 2020 Notes, the 2018 Notes and the 2022 Notes are referred to collectively as the "Securities."

The principal amount of each series of Securities that were validly tendered and not validly withdrawn as of 5:00 p.m., New York City time, on April 1, 2015 (the "Early Tender Date") is specified in the table below.




Title of
Security



CUSIP
Number



Principal Amount
Outstanding




Tender Cap


Acceptance
Priority
Level


Principal
Amount
Tendered



Reference U.S.
Treasury Security


Bloomberg
Reference
Page1
Early
Tender
Premium
(per
$1,000)

Fixed
Spread
(basis
points)
8.25% Senior Notes due 2019 26441YAT4 $250,000,000 N/A 1 $120,462,000 1.375% due 2/29/2020 FIT1 $30.00 60
5.95% Senior Notes due 2017 26441YAM9 $450,000,000 $175,000,000 2 $192,817,000 0.50% due 2/28/2017 FIT1 $30.00 40
6.75% Senior Notes due 2020 26441YAU1 $250,000,000 N/A 3 $121,340,000 1.375% due 2/29/2020 FIT1 $30.00 80
6.50% Senior Notes due 2018 26441YAQ0 $300,000,000 N/A 4 $119,710,000 1.00% due 3/15/2018 FIT1 $30.00 55
4.375% Senior Notes due 2022 26441YAV9 $300,000,000 N/A 5 $91,918,000 2.00% due 2/15/2025 FIT1 $30.00 100

______________

  1. The applicable page on Bloomberg from which the Dealer Managers will quote the bid-side prices of the applicable Reference U.S. Treasury Security.

Upon the terms and subject to the conditions of the Tender Offer, the amounts of each series of Securities that are purchased will be determined in accordance with the acceptance priority levels specified in the table above and on the cover page of the Offer to Purchase, dated March 19, 2015 (the "Offer to Purchase"), in the column entitled "Acceptance Priority Level" (the "Acceptance Priority Level"), with 1 being the highest Acceptance Priority Level and 5 being the lowest Acceptance Priority Level. In addition, no more than $175.0 million aggregate principal amount of the 2017 Notes will be purchased (the "2017 Tender Cap").

Because the amount of the 2017 Notes tendered prior to the Early Tender Date exceeded the 2017 Tender Cap, it is expected that no additional 2017 Notes tendered after the Early Tender Date will be accepted for purchase, and any 2017 Notes not accepted, including 2017 Notes not accepted because of proration, will be returned promptly.

The Tender Offer is being made upon and is subject to the terms and conditions set forth in the Offer to Purchase and the related Letter of Transmittal. The consideration to be paid in the Tender Offer for each series of Securities validly tendered and accepted for purchase will be calculated in the manner described in the Offer to Purchase by reference to a fixed spread over the yield to maturity of the applicable U.S. Treasury Security specified in the Offer to Purchase (the "Total Consideration"). Holders of the Securities that validly tendered and did not withdraw their Securities on or prior to the Early Tender Date and whose Securities are accepted for purchase will receive the applicable Total Consideration, which includes an early tender premium of $30.00 per $1,000 principal amount of the Securities accepted for purchase (the "Early Tender Premium"). The Total Consideration will be determined at 2:00 p.m., New York City time, April 2, 2015 (the "Tender Offer Price Determination Date"), unless extended by Duke Realty.

Payments for Securities purchased will include accrued and unpaid interest from and including the last interest payment date applicable to the relevant series of Securities up to, but not including, the applicable settlement date for such Securities accepted for purchase. The settlement date for Securities that are validly tendered on or prior to the Early Tender Date and accepted for purchase is expected to be April 3, 2015, one business day following the scheduled Tender Offer Price Determination Date (the "Early Settlement Date"). As the Tender Offer was over-subscribed at the Early Tender Date, it is expected that, subject to the priorities and proration rules applicable to the Tender Offer, only Securities validly tendered and not validly withdrawn as of such date will be purchased in accordance with the terms of the Tender Offer, and that no Securities tendered after the Early Tender Date will be purchased in the Tender Offer.

Duke Realty's obligation to accept for payment and to pay for the Securities validly tendered in the Tender Offer is subject to the satisfaction or waiver of a number of general conditions described in the Offer to Purchase. Duke Realty's obligation was also subject to the satisfaction or waiver of the condition that Duke Realty must have completed the previously announced sale of its right, title and interest in a multi-city suburban office portfolio and have received the proceeds from such sale (the "Asset Sale Condition"), which condition was satisfied on April 1, 2015. Duke Realty reserves the right, subject to applicable law, to: (i) waive any and all conditions to the Tender Offer; (ii) extend or terminate the Tender Offer; (iii) increase or decrease the Maximum Tender Amount and/or increase, decrease or eliminate the 2017 Tender Cap; or (iv) otherwise amend the Tender Offer in any respect.

J.P. Morgan Securities LLC and Wells Fargo Securities, LLC are acting as Dealer Managers for the Tender Offer. The Information Agent and Tender Agent for the Tender Offer is D.F. King & Co., Inc. Copies of the Offer to Purchase, Letter of Transmittal and related offering materials are available by contacting the Information Agent at (866) 796-7184 (U.S. toll-free) and (212) 269-5550 (banks and brokers) or dre@dfking.com. Questions regarding the Tender Offer should be directed to J.P. Morgan Securities LLC at (800) 834-4666 (toll-free) or (212) 834-4811 (collect); or Wells Fargo Securities, LLC at (866) 309-6316 (toll-free) or (704) 410-4760 (collect). This news release shall not constitute an offer to sell, a solicitation to buy or an offer to purchase or sell any securities. The Tender Offer is being made only pursuant to the Offer to Purchase and related Letter of Transmittal and only in such jurisdictions as is permitted under applicable law.

About Duke Realty Corporation

Duke Realty Corporation owns, maintains an interest in or has under development approximately 153.2 million rentable square feet of industrial and office assets, including medical office, in 22 major U.S. metropolitan areas. Duke Realty Corporation is publicly traded on the NYSE under the symbol DRE and is listed on the S&P MidCap 400 Index. More information about Duke Realty Corporation is available at www.dukerealty.com

Cautionary Notice Regarding Forward-Looking Statements

This news release may contain forward-looking statements within the meaning of the federal securities laws. All statements, other than statements of historical facts, including, among others, statements regarding the company's future financial position or results, future dividends, and future performance, are forward-looking statements. Those statements include statements regarding the intent, belief or current expectations of the company, members of its management team, as well as the assumptions on which such statements are based, and generally are identified by the use of words such as "may," "will," "seeks," "anticipates," "believes," "estimates," "expects," "plans," "intends," "should," or similar expressions. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that actual results may differ materially from those contemplated by such forward-looking statements. Many of these factors are beyond the company's abilities to control or predict. Such factors include, but are not limited to, (i) general adverse economic and local real estate conditions; (ii) the inability of major tenants to continue paying their rent obligations due to bankruptcy, insolvency or a general downturn in their business; (iii) financing risks, such as the inability to obtain equity, debt or other sources of financing or refinancing on favorable terms, if at all; (iv) the company's ability to raise capital by selling its assets; (v) changes in governmental laws and regulations; (vi) the level and volatility of interest rates and foreign currency exchange rates; (vii) valuation of joint venture investments, (viii) valuation of marketable securities and other investments; (ix) valuation of real estate; (x) increases in operating costs; (xi) changes in the dividend policy for the company's common stock; (xii) the reduction in the company's income in the event of multiple lease terminations by tenants; (xiii) impairment charges, (xiv) the effects of geopolitical instability and risks such as terrorist attacks; (xv) the effects of weather and natural disasters such as floods, droughts, wind, tornados and hurricanes; and (xvi) the effect of any damage to our reputation resulting from developments relating to any of items (i) - (xv). Additional information concerning factors that could cause actual results to differ materially from those forward-looking statements is contained from time to time in the company's filings with the Securities and Exchange Commission. The company refers you to the section entitled "Risk Factors" contained in the company's Annual Report on Form 10-K for the year ended December 31, 2014. Copies of each filing may be obtained from the company or the Securities and Exchange Commission.

The risks included here are not exhaustive and undue reliance should not be placed on any forward-looking statements, which are based on current expectations. All written and oral forward-looking statements attributable to the company, its management, or persons acting on their behalf are qualified in their entirety by these cautionary statements. Further, forward-looking statements speak only as of the date they are made, and the company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time unless otherwise required by law.

Contact Information

  • Contact Information:

    Investors:
    Ron Hubbard
    317.808.6060

    Media:
    Helen McCarthy
    317.708.8010