22 Sep 2010 13:00
Smith International, Inc. (the "Company"), a wholly owned subsidiary of Schlumberger Limited (NYSE:SLB), announced today that it has commenced cash tender offers to purchase (i) any and all of one series of its outstanding notes and (ii) up to a total spend of $1 billion for three additional series of its outstanding notes. The terms and conditions of the tender offers are described in the Offer to Purchase dated September 22, 2010.
The Tender Offer for the Any and All Notes
Upon the terms and subject to the conditions described in the Offer to Purchase, the Company is offering to purchase for cash any and all of its 6.75% Senior Notes due 2011 (the "Any and All Notes").
The following table sets forth some of the terms of the tender offer for the Any and All Notes:
| Title of Notes | CUSIPNumber | PrincipalAmountOutstanding | ReferenceTreasurySecurity | FixedSpread(bps) | BloombergReferencePage | ||||||||||
| 6.75% Senior Notes due2011 | 832110AG5 | $220 million | 5.00% dueFebruary15, 2011 | 35 | PX3 | ||||||||||
Holders of Any and All Notes that are validly tendered on or prior to 5:00 p.m., New York City time, on September 28, 2010 (such time, as it may be extended, the "Any and All Expiration Date") and not subsequently validly withdrawn, and that the Company accepts for purchase, will receive consideration for their Any and All Notes (the "Any and All Notes Total Consideration").
The purchase price for each $1,000 principal amount of Any and All Notes validly tendered pursuant to the tender offer shall be the price equal to the sum of (i) the present value on the settlement date of $1,000 principal amount of the Any and All Notes and (ii) the present value of the interest that would be payable on, or accrue from, the last interest payment date until the maturity date, in each case, determined on the basis of a yield to the maturity date equal to the sum of (x) the bid-side yield on the applicable Reference Treasury Security for the Any and All Notes, plus (y) the applicable fixed spread, minus accrued and unpaid interest from the last interest payment date to, but not including, the settlement date, payable on the settlement date.
Payments for the Any and All Notes purchased by the Company will also include accrued and unpaid interest from and including the last interest payment date up to, but not including, the settlement date.
Holders who tender Any and All Notes on or prior to 5:00 p.m., New York City time, on September 28, 2010 (such date and time, as it may be extended, the "Any and All Withdrawal Deadline") may withdraw such tendered Any and All Notes at any time on or prior to the Any and All Withdrawal Deadline. Following the Any and All Withdrawal Deadline, holders who have tendered their Any and All Notes may not withdraw such Any and All Notes, except as described in the Offer to Purchase or required by law.
The Tender Offer for the Maximum Tender Offer Notes
Upon the terms and subject to the conditions described in the Offer to Purchase, the Company is offering to purchase for cash up to $1,000,000,000 (the "Maximum Payment Amount") in aggregate Tender Offer Consideration and Total Consideration, as applicable, for its: 8.625% Notes due 2014 (the "8.625% Notes"), 6.00% Senior Notes due 2016 (the "6.00% Notes") and 9.75% Notes due 2019 (the "9.75% Notes" and, together with the 8.625% Notes and the 6.00% Notes, the "Maximum Tender Offer Notes").
The following table sets forth some of the terms of the tender offer for the Maximum Tender Offer Notes:
| Title of Notes | CUSIPNumber | PrincipalAmountOutstanding | Tender OfferConsideration(1) | EarlyTenderPremium(1) | TotalConsideration (1) | ||||||||||
| 8.625% Notes due 2014 | 832110AK6 | $300 million | $1,205.00 | $30.00 | $1,235.00 | ||||||||||
| 6.00% Senior Notes due 2016 | 832110AJ9 | $275 million | $1,175.00 | $30.00 | $1,205.00 | ||||||||||
| 9.75% Notes due 2019 | 832110AL4 | $700 million | $1,420.00 | $30.00 | $1,450.00 | ||||||||||
(1) Per $1,000 principal amount of notes tendered.
Holders of Maximum Tender Offer Notes that are validly tendered on or prior to October 5, 2010 (the "Early Tender Date") and not subsequently validly withdrawn, and that the Company accepts for purchase will receive the Total Consideration specified in the table above, which includes the Early Tender Premium specified in the table above. Holders of Notes that are validly tendered after the Early Tender Date, but on or prior October 20, 2010, will receive the Tender Offer Consideration specified in the table above. The Tender Offer Consideration is the Total Consideration minus the Early Tender Premium.
Payments for the Maximum Tender Offer Notes purchased by the Company will also include accrued and unpaid interest from and including the last interest payment date for the respective series of Notes up to, but not including, the settlement date.
If the aggregate Total Consideration and Tender Offer Consideration applicable to the Maximum Tender Offer Notes validly tendered exceeds the Maximum Tender Amount, the amount of Maximum Tender Offer Notes purchased by the Company will be purchased on a prorated basis using a single proration factor applicable equally to all of the Maximum Tender Offer Notes based upon the number of validly tendered Maximum Tender Offer Notes in each series. The proration factor used will be that percentage that, when applied to the aggregate Total Consideration and Tender Offer Consideration applicable to the validly tendered Maximum Tender Offer Notes, comes nearest to but does not exceed the Maximum Tender Amount.
To avoid purchases of Maximum Tender Offer Notes in principal amounts other than integral multiples of $1,000, the Company will, if necessary, round downward to the nearest $1,000 principal amount with respect to each Holder validly tendering such Maximum Tender Offer Notes.
Holders who tender Maximum Tender Offer Notes on or prior to 5:00 p.m., New York City time, on October 5, 2010 (such date and time, as it may be extended, the "Maximum Tender Withdrawal Deadline") may withdraw such tendered Maximum Tender Offer Notes at any time on or prior to the Maximum Tender Withdrawal Deadline. Following the Maximum Tender Withdrawal Deadline, holders who have tendered their Maximum Tender Offer Notes (whether before, on or after the Maximum Tender Withdrawal Deadline) may not withdraw such Maximum Tender Offer Notes, except as described in the Offer to Purchase or required by law.
The complete terms and conditions of each tender offer is set forth in the Offer to Purchase and a Letter of Transmittal, along with any amendments and supplements thereto, which holders are urged to read carefully before making any decision with respect to the tender offers. Copies of the Offer to Purchase and the Letter of Transmittal may be obtained from Global Bondholder Services Corporation, the depositary and information agent for the tender offers, at (212) 430-3774 (banks and brokers) or (866) 804-2200 (all others). Questions regarding the tender offers also may be directed to the dealer managers for the tender offers, Citi at (800) 558-3745 (toll-free) or (212) 723-6106 (collect), JPMorgan at (866) 834-4666 (toll-free) or (212) 834-2494 (collect) or Morgan Stanley at (800) 624-1808 (toll-free) or (212) 761-5384 (collect).
This press release is neither an offer to purchase nor a solicitation of an offer to sell any securities. The Company is making the tender offers only by, and pursuant to the terms of, the Offer to Purchase and a Letter of Transmittal. The tender offers are not being made in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction. None of the Company, the depositary and information agent, the dealer managers or the trustee with respect to the Any and All Notes and the Maximum Tender Offer Notes, or any of their respective affiliates, makes any recommendation as to whether holders should tender or refrain from tendering, all or any portion of their notes in response to the applicable tender offer.
About Schlumberger
Schlumberger is the world's leading supplier of technology, integrated project management and information solutions to customers working in the oil and gas industry worldwide. Employing approximately 105,000 people representing over 140 nationalities and working in approximately 80 countries, Schlumberger provides the industry's widest range of products and services from exploration through production.
Schlumberger Limited has principal offices in Paris, Houston and The Hague and reported revenues of $22.70 billion in 2009. For more information, visit www.slb.com.
| CONTACT: | Schlumberger Limited | |||
| Malcolm Theobald, +1-713-375-3535 (Investors) | ||||
| Vice President of Investor Relations | ||||
| investor-relations@slb.com | ||||
| Stephen Whittaker, + 33 1 4062 1330 (Media) | ||||
| Director of Corporate Communications | ||||
| swhittaker@slb.com |
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