Banco Santander-Chile Announces Commencement of Modified Dutch Auction Tender Offer for its 5.375% Subordinated Notes due 2014

SANTIAGO, Chile, May 9, 2013 /PRNewswire/ -- Banco Santander-Chile ("Santander-Chile") today announced that it has commenced a cash tender offer (the "Offer") for up to $75.0 million aggregate principal amount (as such amount may be increased in Santander-Chile's sole discretion, the "Tender Cap") of its outstanding 5.375% Subordinated Notes due 2014 (the "Notes"). Information related to the Notes and the Offer is listed in the table below.

The "Total Consideration" per $1,000 principal amount of Notes payable to holders who validly tender (and do not withdraw) their Notes on or prior to the Early Tender Date (as defined below) will be equal to a Clearing Price to be determined pursuant to a "modified Dutch Auction" procedure and as set forth below. Each holder that tenders Notes in the Offer will specify a "Bid Price," within the range specified in the table above under "Total Consideration (Acceptable Bid Price Range)", which represents the minimum consideration such holder is willing to receive for those Notes. Holders who tender Notes without specifying a Bid Price will be deemed to have specified $1,045 per $1,000 principal amount of Notes. The Total Consideration payable under the Offer, and the Bid Price specified by holders of Notes electing to participate, includes an "Early Tender Payment" of $30.00 for each $1,000 principal amount of Notes. Holders will only be eligible to receive the Early Tender Payment for Notes that such holders have validly tendered (and not withdrawn) at or prior to 5:00 p.m., New York City time, on May 22, 2013, unless extended by Santander-Chile (the "Early Tender Date"). The Offer is scheduled to expire at 12:00 midnight, New York City time, on June 6, 2013, unless extended or earlier terminated by Santander-Chile (the "Expiration Date").

The "Clearing Price" will be determined based on the Bid Price of all tendered Notes, in order of lowest to highest Bid Price. The Clearing Price will be the single lowest Bid Price so specified that will enable Santander-Chile to purchase an aggregate amount of Notes equal to the Tender Cap.

Santander-Chile may, but is not obligated to, elect, following the Early Tender Date and prior to the Expiration Date, to accept Notes validly tendered (and not withdrawn) at or prior to the Early Tender Date, provided that all conditions to the Offer have been satisfied or waived by Santander-Chile (the date of such acceptance, the "Early Acceptance Date"). Notes accepted on the Early Acceptance Date may be settled on such date or promptly thereafter (the "Early Settlement Date").  If we elect to exercise the Early Settlement Right and accept for purchase Notes in an aggregate principal amount equal to the Tender Cap and we do not elect to increase the Tender Cap, then we will not accept for purchase any Note tendered after the Early Tender Date, irrespective of the Bid Price offered for such Note.

The "Final Settlement Date" with respect to the Offer is the date that Santander-Chile settles all Notes not previously settled on the Early Settlement Date, if any, which is currently expected to be one business day following the Expiration Date. 

If the aggregate amount of Notes validly tendered (and not withdrawn) on or prior to the Expiration Date with a Bid Price equal to or below the Clearing Price exceeds the Tender Cap, then, subject to the terms and conditions of the Offer, Santander-Chile will accept for purchase, first, all Notes validly tendered (and not withdrawn) with a Bid Price less than the Clearing Price, and thereafter, Notes validly tendered (and not withdrawn) with a Bid Price equal to the Clearing Price on a prorated basis.

In addition, holders will receive accrued and unpaid interest (and any additional amounts payable in respect thereof pursuant to the terms of the Indenture governing the Notes) on all Notes tendered and accepted for payment in the Offer from the last interest payment date up to, but not including, the Early Settlement Date or the Final Settlement Date, as applicable.

Notes may be withdrawn any time prior to 5:00 p.m., New York City time, on May 22, 2013, unless extended by Santander-Chile (the "Withdrawal Date"). Holders of Notes who tender their Notes after the Withdrawal Date, but on or prior to the Expiration Date, may not withdraw their tendered Notes. Subject to applicable law, Santander-Chile reserves the right, in its sole discretion, to increase the Tender Cap. If Santander-Chile increases the Tender Cap, it does not currently intend to extend the Withdrawal Date or the Early Tender Date or reinstate withdrawal rights.

The Offer is conditioned on certain customary conditions.  Subject to applicable law, Santander-Chile may amend, modify or terminate the Offer at any time in its sole discretion.

The terms and conditions of the Offer are described in the offer to purchase, dated May 9, 2013 (as it may be amended or supplemented from time to time, the "Offer to Purchase"), and in the related letter of transmittal that will be sent to holders of the Notes. Holders are encouraged to read these documents carefully when they become available.  In the event of an inconsistency between this announcement and the Offer to Purchase, the Offer to Purchase shall govern.

Deutsche Bank Securities Inc. and Santander Investment Securities Inc. will act as dealer managers (the "Dealer Managers") in connection with the Offer. D.F. King & Co., Inc. is the tender and information agent for the Offer. Questions regarding the Offer should be directed to Deutsche Bank Securities Inc. at (866) 627-0391 (toll-free) or (212) 250-2955 (collect) or to Santander Investment Securities Inc. at (212) 407-0995 (collect). Requests for documentation should be directed to D.F. King & Co., Inc. at (800) 659-5550 (toll-free) or (212) 269-5550 (for banks and brokers). This press release is for informational purposes only.

This press release is not an offer to purchase or a solicitation of an offer to purchase with respect to any Notes or any other securities. The Offer is being made solely pursuant to the terms of the Offer to Purchase and related letter of transmittal. The Offer is not being made to holders of Notes 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. The Offer to Purchase and related letter of transmittal do not constitute an offer to purchase in Chile or to any resident of Chile, except as permitted by applicable Chilean law. None of Santander-Chile, the Dealer Managers or D.F. King & Co., Inc. makes any recommendation as to whether holders should tender or refrain from tendering their Notes. Holders must make their own decision as to whether to tender Notes and, if so, the principal amount of the Notes to tender.

Forward-Looking Statements

This document may contain forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934 that are not based on historical facts and are not assurances of future results. These forward-looking statements are based on management's current expectations and estimates about future events and financial trends, which affect or may affect Santander-Chile's businesses and results of operations. The words "believe," "may," "will," "estimate," "continue," "anticipate," "intend," "expect" and similar words are intended to identify estimates and forward-looking statements. These statements include but are not limited to forward-looking statements about the planned Offer, including whether the Offer is consummated in whole or in part. Although Santander-Chile believes that these forward-looking statements are based upon reasonable assumptions, these statements are subject to several risks and uncertainties and are made in light of information currently available to Santander-Chile. Estimates and forward-looking statements involve risks and uncertainties and are not guarantees of future performance. Any changes in such assumptions or factors could cause actual results to differ materially from current expectations and Santander-Chile's future results may differ materially from those expressed in these estimates and forward-looking statements.

All forward-looking statements are expressly qualified in their entirety by this cautionary statement, and you should not place reliance on any forward-looking statement contained in this document. Santander-Chile undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information or future events or for any other reason.

SOURCE Banco Santander-Chile