Altria Announces Consideration for Debt Tender Offer

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Altria Group, Inc. (Altria)
MO
today announces the reference yields, total consideration and tender offer consideration for its previously announced cash tender offer for up to $2,100,000,000 aggregate principal amount (the “Tender Cap”) of its senior unsecured notes identified in the table below (the “Notes”). The terms and conditions of the tender offer are described in the Offer to Purchase, dated October 28, 2013, and the related Letter of Transmittal, as amended by Altria's press release issued earlier today increasing the Tender Cap and Aggregate Maximum Purchase Sublimit. For Notes validly tendered and not validly withdrawn at or prior to 5:00 p.m., New York City time, on November 8, 2013 (the “Early Tender Deadline”) and accepted for purchase, the applicable total consideration per $1,000 principal amount of each series of Notes (for each series, the “Total Consideration”) is the price determined as described in the Offer to Purchase intended to result in a yield to maturity (calculated in accordance with standard market practice) equal to the sum of (i) the yield to maturity for the applicable U.S. Treasury (“UST”) Reference Security specified in the table below, calculated based on the bid-side price of such UST Reference Security as of 11:00 a.m., New York City time, today, November 12, 2013 (being the first business day following the Early Tender Deadline), plus (ii) the applicable Fixed Spread specified in the table below. The Total Consideration includes the Early Tender Payment specified in the table below. Holders tendering their Notes after the Early Tender Deadline and at or prior to 12:00 midnight, New York City time, on Monday, November 25, 2013 (the “Expiration Date”), will be eligible to receive only the applicable Tender Offer Consideration, namely the applicable Total Consideration less the Early Tender Payment specified in the table below. Aggregate Acceptance Maximum U.S. Treasury U.S. Treasury Fixed Total Tender Offer Title of CUSIP Priority Purchase Early Tender Reference Reference Spread Consideration Consideration Securities Number Level Sublimit* Payment** Security Yield (bps) *** *** 9.950% Notes due 2038 02209SAE3 $30 2.875% due 05/15/2043 3.885% 198 $1,531.85 $1,501.85 1 $1,600,000,000 10.200% Notes due 2039 02209SAH6 $30 2.875% due 05/15/2043 3.885% 198 $1,566.68 $1,536.68 9.700% Notes due 2018 02209SAD5 $30 1.375% due 09/30/2018 1.403% 95 $1,341.74 $1,311.74 2 Not Applicable 9.250% Notes due 2019 02209SAJ2 $30 1.375% due 09/30/2018 1.403% 135 $1,340.19 $1,310.19 *Applies to the aggregate principal amount of Notes with Acceptance Priority Level 1. **Per $1,000 principal amount of Notes validly tendered and not validly withdrawn at or prior to the Early Tender Deadline and accepted for purchase. ***Per $1,000 principal amount of Notes accepted for purchase. In addition, holders whose Notes are purchased in the tender offer will be paid accrued and unpaid interest on their purchased Notes from the applicable last interest payment date up to, but not including, the payment date for such purchased Notes. The payment for Notes accepted for purchase is expected to occur on the first business day after the Expiration Date. Assuming that the tender offer expires on November 25, 2013, and the conditions to the tender offer are satisfied or waived, Altria expects the payment for the purchased Notes to be made on November 26, 2013. Earlier today, Altria announced that the total aggregate principal amount of Notes validly tendered and not validly withdrawn at or prior to the Early Tender Deadline was $3,808,739,000, which amount exceeds the Tender Cap. Since Altria will accept for payment only such portion of the tendered Notes that does not result in it purchasing Notes with an aggregate principal amount above the Aggregate Maximum Purchase Sublimit and the Tender Cap, Altria will purchase a portion of the validly tendered Notes with Acceptance Priority Level 1 up to the Aggregate Maximum Purchase Sublimit, and will purchase Notes with Acceptance Priority Level 2 in an aggregate principal amount up to the Tender Cap remaining available for application to the Acceptance Priority Level 2 Notes following the purchase of the Acceptance Priority Level 1 Notes, in accordance with the terms of the tender offer set forth in the Offer to Purchase. Assuming that the conditions to the tender offer are satisfied or waived, tendered Notes will be accepted for purchase on a prorated basis as described in the Offer to Purchase, such that the aggregate principal amount of the Notes accepted in the tender offer equals the Tender Cap. All Notes tendered and not accepted for purchase will be returned to holders following the Expiration Date in accordance with the terms of the tender offer. The tender offer for the Notes will expire on the Expiration Date, unless extended or earlier terminated by Altria. Note Issuance On October 31, 2013, Altria completed an underwritten public offering of senior unsecured notes in an aggregate principal amount sufficient to satisfy the financing condition described in the Offer to Purchase. The tender offer is subject to the satisfaction or waiver of certain other conditions, as specified in the Offer to Purchase.
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