Tiffany & Co. (TIF) Announces Aggregate $500M Senior Notes Offerings; Sees Charges on Redemptions

Tiffany & Co. (NYSE: TIF) announced its intention to offer, subject to market and other conditions, its Senior Notes due 2024 and Senior Notes due 2044 (together, the “notes”) in an aggregate principal amount of $500,000,000. The initial purchasers of the notes are expected to be Merrill Lynch, Pierce, Fenner & Smith Incorporated, Goldman, Sachs & Co., BNY Mellon Capital Markets, LLC, J.P. Morgan and Mizuho Securities. The Company intends to use the net proceeds from the notes offering to redeem (i) all $100,000,000 principal amount outstanding of its 9.05% Series A Senior Notes due December 23, 2015; (ii) all $125,000,000 principal amount outstanding of its 10.0% Series A-2009 Senior Notes due February 13, 2017; (iii) all $50,000,000 principal amount outstanding of its 10.0% Series A Senior Notes due April 9, 2018; and (iv) all $125,000,000 principal amount outstanding of its 10.0% Series B-2009 Senior Notes due February 13, 2019 prior to maturity in accordance with the respective note purchase agreements governing such notes. The Company intends to use any remaining net proceeds from the sale of the notes for general corporate purposes. As a result of the redemptions, the Company expects to record a debt extinguishment charge, which it estimates will, for the fiscal year ending January 31, 2015, reduce net earnings by approximately $55 million - $70 million and net earnings per diluted share by approximately $0.43 to $0.53.

The Company also announced that it is seeking commitments to replace its existing $275,000,000 three year unsecured revolving credit facility maturing December 19, 2014 and $275,000,000 five year unsecured revolving credit facility maturing December 21, 2016 with a new $375,000,000 four year unsecured revolving credit facility and a new $375,000,000 five year unsecured revolving credit facility. The new credit facilities are expected to close after the closing of the notes offering.

The notes will be fully and unconditionally guaranteed by certain of the Company’s subsidiaries. However, the guarantees of the notes will terminate automatically if the relevant subsidiary guarantor ceases to guarantee any other material indebtedness of the Company. The Company expects that upon closing of the notes offering, execution of the new credit facilities and completion of certain other contemplated refinancing transactions, all subsidiary guarantees of the notes will be released.

The notes will be offered and sold to qualified institutional buyers in the United States pursuant to Rule 144A and outside the United States pursuant to Regulation S under the Securities Act of 1933, as amended (the “Securities Act”).

The notes have not been registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state laws.

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