FedEx Extends Expiration & Amends Senior Notes Exchange Offer
FedEx Corp. (NYSE: FDX) has announced an extension to the expiration date of its ongoing exchange offers (“Exchange Offers”) and the related consent solicitations (“Consent Solicitations”) for its outstanding senior notes. The new expiration date has been moved from February 6, 2025, to February 21, 2025, at 5:00 p.m. New York City time. This extension allows eligible holders additional time to participate in the Exchange Offers and Consent Solicitations.
The purpose of these Exchange Offers is to allow holders of existing senior notes (the “Existing Notes”) to exchange them for new notes (the “New Notes”). As part of this process, FedEx has also initiated Consent Solicitations to approve proposed amendments (the “Proposed Amendments”) to the indentures governing the Existing Notes. While the expiration date has been extended, the right of holders to withdraw their tendered Existing Notes expired on January 22, 2025, at 5:00 p.m. New York City time.
Holders who tendered their Existing Notes before the Early Participation Date were eligible to receive the Total Consideration, which includes both the Exchange Consideration and an Early Participation Payment. For each $1,000 principal amount of Existing USD Notes or €1,000 of Existing Euro Notes, holders were entitled to receive $970 in New USD Notes or €970 in New Euro Notes. Additionally, an Early Participation Payment of $30 in New USD Notes and $2.50 in cash, or €30 in New Euro Notes and €2.50 in cash, was provided.
The amendments to the Exchange Offers ensure that holders of specific note series who tendered after the Early Participation Date but before the Prior Expiration Date received the Total Consideration, including the cash portion of the Early Participation Payment. These notes include the 4.200% Notes due 2028, 4.250% Notes due 2030, 3.875% Notes due 2042, 4.050% Notes due 2048, 4.950% Notes due 2048, 5.250% Notes due 2050, and 1.300% Notes due 2031. Meanwhile, eligible holders of other Existing Notes who tendered during this period received New Notes equal to the principal amount of their tendered Existing Notes but were not eligible for the cash portion of the Early Participation Payment.
As part of its latest announcement, FedEx has amended the terms of the Exchange Offers for its 3.875% Notes due 2042, 4.050% Notes due 2048, 4.950% Notes due 2048, and 5.250% Notes due 2050. Eligible holders who tender these notes after the Prior Expiration Date but before the extended Expiration Date will receive an equivalent principal amount of New Notes but will not receive the cash portion of the Early Participation Payment. However, holders of the 4.200% Notes due 2028, 4.250% Notes due 2030, and 1.300% Notes due 2031, categorized as “Non-Majority Existing Notes,” will still be eligible to receive the full Total Consideration, including the cash portion of the Early Participation Payment.
For holders of the remaining series of Majority Existing Notes who tender their notes after the Prior Expiration Date but before the extended Expiration Date, the same conditions will continue to apply. Apart from the amendments described in this announcement, all other terms of the Exchange Offers and Consent Solicitations, as outlined in the confidential offering memorandum and consent solicitation statement (the “Offering Memorandum”), remain unchanged.
The Exchange Offers and Consent Solicitations are being conducted as part of FedEx’s broader plans related to the contemplated Separation. This Separation refers to FedEx’s strategy to separate its FedEx Freight business from the parent company, potentially through an asset sale, exchange, transfer, distribution, or another disposition. It is important to note that the Exchange Offers and Consent Solicitations are not contingent upon the completion of the Separation, nor is the Separation conditioned upon the completion of these Exchange Offers.
In summary, FedEx’s decision to extend the Exchange Offers and Consent Solicitations provides eligible holders with additional time to participate. The amendments to the Exchange Offers ensure that specific noteholders continue to receive favorable terms, depending on when they tender their Existing Notes. As the company progresses with its planned Separation, these financial maneuvers will play a crucial role in restructuring FedEx’s debt and aligning its financial strategy with future operational objectives.