Non-US Tender and Exchange Of

RNS Number : 0185L

Royal Bank of Scotland Group PLC

29 April 2010

 

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION TO ANY PERSON LOCATED OR RESIDENT IN THE UNITED STATES, ITALY, JAPAN, AUSTRALIA OR TO US PERSONS

(SEE "OFFER RESTRICTIONS" BELOW)

29 April 2010

THE ROYAL BANK OF SCOTLAND GROUP PLC ANNOUNCES PRICING OF UPPER TIER 2 EXCHANGE OFFERS, RESULTS OF MEETINGS AND ACCEPTANCES OF EXCHANGE AND TENDER OFFERS

Further to its announcement yesterday, The Royal Bank of Scotland Group plc ("RBSG" and, together with its subsidiaries, the "Group"), announces (1) in respect of an invitation to holders ("Exchange Holders") of certain existing upper tier 2 debt securities of the Group ("Exchange Securities") to offer to exchange any or all of such securities for new senior unsecured notes of RBS (the "Exchange Offer"), (i) whether such Offers to Exchange pursuant to the Exchange Offer are accepted; (ii) the aggregate principal amount of each series of Exchange Securities that RBS has accepted for exchange, the Exchange Price, the Accrued Distributions in respect of such Exchange Securities and the aggregate principal amount of each series of Exchange Securities subsequently outstanding; (iii) each Mid-Swap Rate; (iv) each New Issue Yield; (v) each New Issue Price; (vi) each New Issue Coupon; (vii) each Exchange Ratio; (viii) each New Issue Amount and (ix) the Settlement Date and (2) in respect of invitations to holders of certain classes of existing preference shares, trust preferred securities and tier one notes of the Group (the "Tender Securities") to tender such securities for purchase by RBSG and National Westminster Bank Public Limited Company ("NatWest") (together, the "Tender Offerors") for cash (the "Tender Offers"), (i) whether the General Meeting Resolutions and the Class Resolutions have been passed; (ii) whether the Tender Offerors will accept valid tenders of Tender Securities pursuant to the Tender Offers; and (iii) the final aggregate liquidation preference and principal amount of Tender Securities accepted for purchase, the Accrued Distributions in respect of such Tender Securities and the aggregate liquidation preference and principal amount of Tender Securities subsequently outstanding. Details of the Exchange Offer and the Tender Offers were set out in the Exchange Offer Memorandum and Tender Offer Memorandum, each dated 6 April 2010.

The Exchange Offer, the Tender Offers and the tender offers by RBSG and NatWest in respect of certain classes of existing preference shares, trust preferred securities and capital and tier one securities (the "U.S. Tender Offers") were subject to approval by the shareholders of RBSG of a resolution to approve repurchases of preference shares in the Tender Offers and U.S. Tender Offers. The resolution was voted on and approved at a general meeting of shareholders held yesterday (the "GM").

Capitalised terms used and not otherwise defined in this announcement have the meaning given in the Exchange Offer Memorandum or Tender Offer Memorandum, as applicable.

THE EXCHANGE OFFER

RBSG today announces that RBS has accepted Offers to Exchange pursuant to the Exchange Offer with a face value of £2,256,544,661 equivalent, which represents 54.58 per cent. of the face value of those outstanding securities targeted as part of the Exchange Offer.

The table below sets out, (i) the aggregate principal amount of each series of Exchange Securities that RBS has accepted for exchange, the Exchange Price, the Accrued Distributions in respect of such Exchange Securities and the aggregate principal amount of each series of Exchange Securities subsequently outstanding; (ii) each Mid-Swap Rate; (iii) each New Issue Yield; (iv) each New Issue Price; (v) each New Issue Coupon; (vi) each Exchange Ratio; and (vii) each New Issue Amount.

Exchange Securities							New Notes
				Exchange Price as a percentage		Aggregate Principal Amount
			Aggregate Principal Amount of	of the principal amount of	Accrued Distributions (per 1,000	Outstanding following Exchange	Mid-Swap Rate	New Issue Yield	New Issue Price	New Issue Coupon	Exchange Ratio	New Issue Amount	Series Number of
ISIN of Exchange Securities	Issuer	Title of Exchange Securities	Offers to Exchange accepted	Exchange Securities	nominal amount)	Offer	(per cent.)	(per cent.)	(per cent.)	(per cent.)			New Notes
CA780097AR28	RBS	CAD700,000,000 5.37 per cent. Fixed/Floating Undated Subordinated Callable Step-Up Notes	CAD226,260,000	73.00	CAD0.735616	CAD473,740,000	3.441	5.941	99.673	5.875	73.2395	CAD165,698,000	3180
GB0006267073	NATWEST	U.S.$500,000,000 Primary Capital Floating Rate Notes Series A	U.S.$138,780,000	60.00	U.S.$1.909722	U.S.$192,920,000	2.663	5.013	99.672	5.000	60.1974	U.S.$171,801,000	3179
GB0006267180	NATWEST	U.S.$500,000,000 Primary Capital Floating Rate Notes Series B	U.S.$63,700,000	60.00	U.S.$1.423611	U.S.$229,340,000	2.663	5.013	99.672	5.000	60.1974	U.S.$171,801,000	3179
GB0007547507	RBSG	U.S.$350,000,000 Undated Floating Rate Primary Capital Notes	U.S.$56,610,000	60.00	U.S.$2.517361	U.S.$106,690,000	2.663	5.013	99.672	5.000	60.1974	U.S.$171,801,000	3179
LU0001547172	NATWEST	U.S.$500,000,000 Primary Capital Floating Rate Notes Series C	U.S.$26,340,000	60.00	U.S.$0.972222	U.S.$285,300,000	2.663	5.013	99.672	5.000	60.1974	U.S.$171,801,000	3179
XS0041078535/ GB0006210255	NATWEST	£200,000,000 11.5 per cent. Undated Subordinated Notes	£20,534,000	100.00	£47.916667	£34,232,000	4.148	6.848	99.176	6.875	100.8308	£739,033,000	3177
XS0045071932	RBS	£200,000,000 9.50 per cent. Undated Subordinated Bonds	£41,852,000	100.00	£72.569444	£103,583,000	3.428	5.928	99.912	6.000	100.881	£519,943,000	3176
XS0102480786	NATWEST	€100,000,000 Floating Rate Undated Subordinated Notes	€89,440,000	80.00	€3.170667	€10,560,000	1.739	3.689	99.821	3.625	80.1435	€316,927,000	3178
XS0102480869	NATWEST	€400,000,000 Fixed/Floating Rate Undated Subordinated Notes	€222,383,000	80.00	€3.170667	€177,617,000	1.739	3.689	99.821	3.625	80.1435	€316,927,000	3178
XS0102493508	NATWEST	£325,000,000 7.625 per cent. Undated Subordinated Step-Up Notes	£74,455,000	81.00	£11.345118	£87,272,000	3.428	5.928	99.912	6.000	81.0713	£519,943,000	3176
XS0102493680	NATWEST	£200,000,000 7.125 per cent. Undated Subordinated Step-Up Notes	£72,257,000	85.00	£43.937500	£54,544,000	4.148	6.848	99.176	6.875	85.7062	£739,033,000	3177
XS0116447599	RBS	£175,000,000 7.375 per cent. Fixed Rate Undated Subordinated Notes	£65,330,000	81.00	£52.649306	£30,441,000	3.428	5.928	99.912	6.000	81.0713	£519,943,000	3176
XS0137784426	RBS	£350,000,000 6.25 per cent. Fixed Rate Undated Subordinated Notes	£66,110,000	80.00	£25.856164	£51,289,000	3.428	5.928	99.912	6.000	80.0705	£519,943,000	3176
XS0138939854	RBS	£350,000,000 5.625 per cent. Fixed Rate Undated Subordinated Notes	£181,714,000	78.00	£53.013699	£18,813,000	4.148	6.848	99.176	6.875	78.6481	£739,033,000	3177
XS0144810529	RBS	£500,000,000 6.20 per cent. Fixed Rate Undated Subordinated Notes	£152,660,000	82.00	£9.512329	£21,175,000	4.148	6.848	99.176	6.875	82.6813	£739,033,000	3177
XS0154144132	RBS	£300,000,000 5.625 per cent. Fixed Rate Undated Subordinated Notes	£267,580,000	78.00	£37.448630	£15,867,000	4.148	6.848	99.176	6.875	78.6481	£739,033,000	3177
XS0164828385	RBS	£500,000,000 5.125 per cent. Fixed Rate Undated Subordinated Notes	£123,539,000	80.00	£8.986301	£54,582,000	3.428	5.928	99.912	6.000	80.0705	£519,943,000	3176
XS0193721544	RBS	£500,000,000 6.0 per cent. Fixed Rate Undated Subordinated Notes	£81,615,000	80.00	£41.260274	£56,074,000	3.428	5.928	99.912	6.000	80.0705	£519,943,000	3176
XS0195230635	RBS	€500,000,000 5.125 per cent. Fixed/Floating Rate Undated Subordinated Notes	€21,480,000	80.00	€44.650685	€175,644,000	1.739	3.689	99.821	3.625	80.1435	€316,927,000	3178
XS0195231526	RBS	€1,000,000,000 Floating Rate Undated Subordinated Notes	€73,214,000	68.00	€1.405389	€169,350,000	1.739	3.689	99.821	3.625	68.1219	€316,927,000	3178
XS0206633082	RBS	£600,000,000 5.50 per cent. Fixed Rate Undated Subordinated Notes	£225,087,000	78.00	£24.863014	£34,928,000	4.148	6.848	99.176	6.875	78.6481	£739,033,000	3177
XS0247645160	RBS	£400,000,000 5.0 per cent. Fixed/Floating Undated Subordinated Callable Step-Up Notes	£189,110,000	78.00	£8.219178	£940,000	3.428	5.928	99.912	6.000	78.0687	£519,943,000	3176

Exchange Holders who have validly offered to exchange their Exchange Securities will receive an aggregate principal amount of the relevant series of New Notes calculated by multiplying (i) the aggregate principal amount of the relevant series of Exchange Securities accepted for exchange by RBS and (ii) the Exchange Ratio for such series of Exchange Securities.

The Exchange Offer was subject to approval by the shareholders of RBSG of a resolution to approve repurchases of preference shares in the Tender Offers and U.S. Tender Offers. The resolution was voted on and approved yesterday.

A cash amount will be paid by the relevant issuer of the Exchange Securities on the Settlement Date to each relevant Exchange Holder equal to (i) the Accrued Distribution (if any) and (ii) the Cash Rounding Amount (if applicable) which arises as a result of the application of the relevant Exchange Ratio.

Settlement of the Exchange Offer will occur on 17 May 2010.

THE TENDER OFFERS

RBSG today announces that it has accepted valid offers of Euro, Sterling and Canadian Dollar Tender Securities from 4 separate series, with a face value of £2,025,680,747 equivalent, all in accordance with the Aggregate Offer Limit and Acceptance Priority announced on 6 April 2010.

The Tender Securities are set out below. The aggregate liquidation preference/principal amount of each series of Tender Securities which has been accepted for purchase for each class and series of Tender Securities, the Accrued Distributions and the aggregate liquidation preference and principal amount of Tender Securities subsequently outstanding are as follows:

				Aggregate Liquidation Preference (in the case of Preference Shares) or Principal Amount (in the case of Debt Securities) which has been	Aggregate Liquidation Preference (in the case of Preference Shares) or Principal Amount (in the case of Debt Securities)	Purchase Price as a percentage of Liquidation Preference (in the case of Preference Shares) or Principal Amount
			Title of Tender Securities	accepted for purchase	outstanding following Tender Offer	(in the case of Debt Securities) (2)	Accrued Distributions
Acceptance Priority	ISIN	Issuer(1)			(m)	(per cent.)	(per 1,000 nominal amount)
1	XS0323734961	RBSG	€1,300,000,000 7.0916 per cent. Non-cumulative Preference Shares Series 3	€828,550,000	€471,450,000.00	65.00	€41.966729
2	XS0323839042	ARGON CAPITAL PUBLIC LIMITED COMPANY	£750,000,000 8.1620 per cent. Perpetual Non-cumulative Securities Series 100	£695,558,000	£54,442,000.00	68.00	£48.301151
3	CA780097AT83	RBSG	CAD600,000,000 6.666 per cent. Fixed/Floating Rate Undated Callable Step-Up Tier 1 Notes	CAD279,311,000	CAD320,689,000.00	72.00	CAD5.296274
4	DE000A0E6C37	RBSG	€1,250,000,000 5.25 per cent. Non-cumulative Preferred Securities Series 2	€465,011,000	€784,989,000.00	57.00	€44.333333
5	XS0205935470	RBSG	€1,250,000,000 5.50 per cent. Non-cumulative Preferred Securities Series 1	€0.00	€1,250,000,000	57.00	€0.00
6	XS0237530497	RBS CAPITAL TRUST C	€500,000,000 4.243 per cent. Fixed/Floating Rate Non-Cumulative Trust Preferred Securities	€0.00	€166,379,000(3)	63.00	€0.00
7	XS0277453774	RBS CAPITAL TRUST D	£400,000,000 5.6457 per cent. Fixed/Floating Rate Non-Cumulative Trust Preferred Securities	£0.00	£92,549,000 (4)	65.00	£0.00
8	XS0159056208	RBS CAPITAL TRUST B	U.S.$750,000,000 6.80 per cent. Non-Cumulative Trust Preferred Securities	U.S.$0.00	U.S.$485,858,000(5)	61.00	U.S.$0.00
9	XS0149161217	RBS CAPITAL TRUST A	€1,250,000,000 6.467 per cent. Non-Cumulative Trust Preferred Securities	€0.00	€390,929,000(6)	65.00	€0.00
10	GB0007548026	RBSG	£400,000 5.5 per cent. Cumulative Preference Shares	£0.00	£400,000	70.00	£0.00
11	GB0006227051	NATWEST	£140,000,000 9.00 per cent. Non-cumulative Preference Shares Series A	£0.00	£140,000,000	100.00	£0.00
12	GB0007548133	RBSG	£500,000 11.00 per cent. Cumulative Preference Shares	£0.00	£500,000	100.00	£0.00
13	XS0121856859	RBSG	£200,000,000 7.3870 per cent. Non-cumulative Convertible Preference Shares Series 1	£0.00	£200,000,000	100.00	£0.00

Notes:

(1) The Tender Offeror that invited holders of the relevant Tender Securities (subject to the offer restrictions referred to in Part I "Offer and Distribution Restrictions" of the Tender Offer Memorandum) to tender their Tender Securities for purchase by such Tender Offeror is the same entity that issued the Tender Securities, except in the case of the Argon Notes and the Capital Trust Securities, where the relevant Tender Offeror is RBSG.

(2) The Purchase Price does not include Accrued Distributions, which will be paid by the Tender Offerors in addition to the Purchase Price.

(3) The principal amount outstanding excludes the €333,621,000 in aggregate principal amount of these Debt Securities held by the Group.

(4) The principal amount outstanding excludes the £307,451,000 in aggregate principal amount of these Debt Securities held by the Group.

(5) The principal amount outstanding excludes the $264,142,000 in aggregate principal amount of these Debt Securities held by the Group.

(6) The principal amount outstanding excludes the €859,071,000 in aggregate principal amount of these Debt Securities held by the Group.

Completion of the Tender Offers was conditional upon the satisfaction or waiver of the conditions set out in the Tender Offer Memorandum, all of which conditions have now been satisfied or waived. In particular, the Tender Offers were subject to approval by the shareholders of RBSG of a resolution to approve repurchases of preference shares in the Tender Offers and U.S. Tender Offers. The resolution was voted on and approved at the GM yesterday. In addition, the tender offers for each of the €1,300,000,000 7.0916 per cent. Non-cumulative Preference Shares Series 3 issued by RBSG and the £200,000,000 7.3870 per cent. Non-cumulative Convertible Preference Shares Series 1 issued by RBSG (together, the "Relevant Securities") were subject to approval of (i) the relevant special resolutions to be considered and, if thought fit, passed at the GM to amend the Articles of Association of RBSG to remove pricing restrictions applicable to the purchases of Relevant Securities by RBSG (the "Amendment Resolutions"); and (ii) the relevant special resolutions to be considered and, if thought fit, passed by holders of the Relevant Securities sanctioning the variation of rights attaching to such Relevant Securities as a result of the relevant Amendment Resolutions (the "Class Resolutions"). The Amendment Resolutions and the Class Resolutions were both voted on and approved yesterday.

The total amount that will be paid to each Tender Holder on the Settlement Date for the Tender Securities of such Tender Holder accepted for purchase will be an amount (rounded to the nearest €0.01, CAD0.01 or £0.01, as the case may be, with half a cent/penny rounded upwards) equal to the sum of the Purchase Price and the Accrued Distribution on such Tender Securities.

Settlement of the Tender Offers will occur on 4 May 2010.

GENERAL

Exchange Holders and Offer Security Holders (together, the "Holders") are advised to read carefully the Exchange Offer Memorandum or Tender Offer Memorandum, as applicable, for full details of, and information on, the Exchange Offer and the Tender Offers.

Neither the Exchange Offer nor the Tender Offers are being made to any person located or resident in the United States, Italy, Japan or Australia or to US Persons (as defined in Regulation S under the United States Securities Act of 1933 (the "Securities Act")) and have also been restricted in other jurisdictions, as more fully described below and in the Exchange Offer Memorandum and Tender Offer Memorandum.

Requests for information in relation to the Exchange Offer or the Tender Offers should be directed to the Lead Dealer Managers in relation to the Exchange Offer and the Tender Offers, being The Royal Bank of Scotland Plc, Merrill Lynch International and Morgan Stanley & Co. International plc:

Global Arranger, Lead Dealer Manager & Advisor The Royal Bank of Scotland plc 135 Bishopsgate London EC2M 3UR

Tel: [phone]/3781

Fax: [phone]

Attention: Harman Dhami/Sean Richardson/David Carmalt/Gianmarco Deiana

Email: [e-mail]

Lead Dealer Manager and Advisor Merrill Lynch International 2 King Edward Street London EC1A 1HQ	Lead Dealer Manager Morgan Stanley & Co. International plc 25 Cabot Square London E14 4QA
Tel: [phone]	Tel: [phone]
Fax:[phone]
Attention: John Cavanagh	Attention: Liability Management
Email: [e-mail]	Email: [e-mail]

Dealer Manager HSBC Bank plc 8 Canada Square London E14 5HQ	Dealer Manager J.P. Morgan Securities Ltd. 125 London Wall London EC2Y 5AJ
Tel: [phone]	Tel: [phone]
Fax: [phone]	Fax:[phone]
Attention: Andrew Montgomery	Attention: FIG Syndicate/Liability Management
Email: [e-mail]	Email: [e-mail]/ [e-mail]

The Royal Bank of Scotland plc, Merrill Lynch International, Morgan Stanley & Co. International plc, HSBC Bank plc and J.P. Morgan Securities Ltd. are together referred to herein as the "Managers".

Requests for information in relation to procedural matters relating to the Exchange Offer and the Tender Offers, and for any documents or materials relating to, the Exchange Offer or the Tender Offers as applicable should be directed to the Exchange and Tender Agent for those Exchange Securities or Tender Securities (together, the "Existing Securities") held in Euroclear or Clearstream, Luxembourg, the Registrar for Existing Securities held in CREST or in definitive form, or the Canadian Exchange Agent for any Existing Securities held in CDS:

EXCHANGE AND TENDER AGENT

Lucid Issuer Services Limited 436 Essex Road London N1 3QP United Kingdom

Tel: [phone]

Fax: [phone]

Attention: Sunjeeve Patel, Yves Theis, David Shilson

email: [e-mail]

REGISTRAR

Computershare Investor Services PLC Corporate Actions Bristol BS99 6AH

Tel: [phone]

Fax: [phone]

Attention: Steve Anderson

email: [e-mail]

CANADIAN EXCHANGE AGENT

Equity Transfer & Trust Company 200 University Avenue, Suite 400 Toronto, Ontario M5H 4H1 Canada

Tel: [phone]

Fax: [phone]

Attention: Corporate Actions

email: [e-mail]

DISCLAIMER

This announcement must be read in conjunction with the Exchange Offer Memorandum and the Tender Offer Memorandum. This announcement, the Exchange Offer Memorandum and the Tender Offer Memorandum contain important information which must be read carefully. If any Holder is in any doubt as to the action it should take, it is recommended to seek its own legal, tax and financial advice, including as to any tax consequences, from its stockbroker, bank manager, solicitor, accountant or other independent financial adviser.

No offer or invitation to acquire or exchange any securities is being made pursuant to this announcement. None of this announcement, the Exchange Offer Memorandum or the Tender Offer Memorandum constitute an invitation to participate in the Exchange Offer or the Tender Offers in any jurisdiction in which, or to or from any person to or from whom, it is unlawful to make such invitation under applicable securities laws and offers of Exchange Securities for exchange pursuant to the Exchange Offer and tenders of Tender Securities pursuant to the Tender Offers have not been accepted from Holders in any jurisdiction where such invitation or offer to exchange or tender is unlawful.

The distribution of this announcement, the Exchange Offer Memorandum and the Tender Offer Memorandum in certain jurisdictions may be restricted by law. Persons into whose possession this announcement and/or the Exchange Offer Memorandum and/or the Tender Offer Memorandum comes are required by each of the RBS Entities, the Dealer Managers and the Exchange and Tender Agent to inform themselves about, and to observe, any such restrictions.

OFFER RESTRICTIONS

United States

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN THE UNITED STATES

These materials are not for distribution, directly or indirectly, in or into the United States (including its territories and possessions, any State of the United States and the District of Columbia). The Exchange Offer and the Tender Offers referenced herein have not been made, directly or indirectly, in or into the United States, or by use of the mails, or by any means or instrumentality (including, without limitation, e-mail, facsimile transmission, telephone and the internet) of interstate or foreign commerce, or of any facility of a national securities exchange, of the United States and neither the Exchange Offer nor the Tender Offers were capable of acceptance by any such use, means, instrumentality or facility or from within the United States.

These materials do not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States. The securities mentioned herein have not been, or will not be, registered under the Securities Act. The securities may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act. There will be no public offer of securities in the United States.

Italy

This announcement, the Exchange Offer and the Tender Offers have not been and are not being made, directly or indirectly, in the Republic of Italy ("Italy"). The Exchange Offer and Exchange Offer Memorandum and the Tender Offers and Tender Offer Memorandum have not been submitted to the clearance procedures of the Commissione Nazionale per le Società e la Borsa ("CONSOB") pursuant to Italian laws and regulations. Accordingly, Holders are notified that, to the extent such holders are located or resident in Italy, the Exchange Offer and Tender Offers have not been available to them nor may the New Notes be offered, sold or delivered in Italy, and neither the Exchange Offer Memorandum, the Tender Offer Memorandum nor any other documents or materials relating to the Exchange Offer, the Tender Offers, the Existing Securities or the New Notes may be distributed or made available in Italy.

United Kingdom

The communication of (i) this announcement and (ii) the Exchange Offer Memorandum, the Tender Offer Memorandum and any other documents or materials relating to the Exchange Offer or the Tender Offers is not being made and such documents and/or materials have not been approved by an authorised person for the purposes of section 21 of the Financial Services and Markets Act 2000. Accordingly, the documents and/or materials referred to in (ii) are not being distributed to, and must not be passed on to, the general public in the United Kingdom. The communication of the documents and/or materials referred to in (i) and (ii) as a financial promotion is only being made to those persons in the United Kingdom falling within the definition of investment professionals (as defined in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Financial Promotion Order")) (and any persons who do not have professional experience in matters relating to investments should not rely on such documents and/or materials) or persons who are within Article 43 of the Financial Promotion Order or any other persons to whom it may otherwise lawfully be made in accordance with the Financial Promotion Order.

Other

The Exchange Offer and the Tender Offers have been subject to further offer and distribution restrictions as more fully set out in the Exchange Offer Memorandum and the Tender Offer Memorandum. The distribution of this announcement in those jurisdictions is restricted by the laws of such jurisdictions. No action has been or will be taken in any jurisdiction in relation to the Exchange Offer that would permit a public offering of securities.

 

END

 

 

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