NiSource Announces Cash Tender Offers for Debt Securities

Nov 14, 2011, 10:33 ET from NiSource Inc.

MERRILLVILLE, Ind., Nov. 14, 2011 /PRNewswire/ -- NiSource Inc. (NYSE: NI) announced today that its finance subsidiary, NiSource Finance Corp., has commenced cash tender offers for two series of its outstanding debt securities.    

The tender offers are made pursuant to an Offer to Purchase, dated November 14, 2011 (the "Offer to Purchase") and related Letter of Transmittal dated November 14, 2011 (the "Letter of Transmittal"), which set forth a comprehensive description of the terms of the offers.  NiSource Finance intends to fund a portion of the purchase price of the notes accepted in the offers with the net proceeds from the sale of long-term debt securities in a public offering announced separately today.

Any and All Offer for 2016 Notes

Upon the terms and subject to the conditions described in the Offer to Purchase, NiSource Finance is offering to purchase for cash any and all of its outstanding 10.75% Notes due 2016 ("2016 Notes").

The following table sets forth some of the terms of the Any and All Offer:

Title of Security

CUSIP Number

Principal Amount Outstanding

Reference U.S. Treasury Security

Bloomberg Reference Page(1)

Fixed Spread (Basis Points)

Early Tender Payment(2)

10.75% Notes due 2016

65473QAU7

$326,855,000

1.000% UST due 10/31/16

PX1

125

$30

(1) The applicable page on Bloomberg from which the Dealer Manager will quote the bid side prices of the applicable Reference U.S. Treasury Security.

(2) Per $1,000 principal amount of notes validly tendered before 5:00 p.m., New York City time, on November 22, 2011, not validly withdrawn and accepted for purchase.

The Any and All Offer is scheduled to expire at 11:59 p.m., New York City time, on December 12, 2011 (the "Expiration Date").  Holders of 2016 Notes that are validly tendered on or prior to 5:00 p.m., New York City time, on November 22, 2011 (such time, as it may be extended, the "Early Participation Date"), and not subsequently validly withdrawn, will receive as consideration for their 2016 Notes an amount which includes an early tender payment.  Holders who validly tender their notes after the Early Participation Date, but before the Expiration Date, will receive as consideration for their 2016 Notes an amount which does not include the early tender payment.  Tenders of 2016 Notes may be validly withdrawn at any time up to 5:00 p.m., New York City time, on November 22, 2011 (the "Withdrawal Date").

The total consideration for each $1,000 principal amount of 2016 Notes validly tendered and accepted for payment pursuant to the Any and All Offer will be determined in the manner described in the Offer to Purchase by reference to the fixed spread over the yield to maturity of the applicable U.S. Treasury Security specified for the 2016 Notes on the cover page of the Offer to Purchase.

NiSource Finance may, at its option, accept for payment 2016 Notes validly tendered on or prior to the Early Participation Date at any time after the Early Participation Date and prior to the Expiration Date (any such date being the "Early Acceptance Date").  If NiSource Finance elects to have an Early Acceptance Date, it expects to purchase the 2016 Notes validly tendered and not withdrawn on or prior to the Early Participation Date promptly following the Early Acceptance Date (the "Early Settlement Date").

In addition to the consideration amounts described above, holders whose 2016 Notes are accepted for purchase will receive accrued and unpaid interest up to, but not including, the applicable settlement date.

Maximum Tender Offer for 2013 Notes

Upon the terms and subject to the conditions described in the Offer to Purchase, if less than $250 million aggregate principal amount of 2016 Notes are validly tendered and accepted for purchase in the Any and All Offer, an amount of 6.15% Notes due 2013 ("2013 Notes") equal to the difference between $250 million and the aggregate principal amount of 2016 Notes validly tendered and accepted for purchase (such difference being the "Maximum Tender Offer Amount") will be accepted for purchase.  If $250 million or more aggregate principal amount of 2016 Notes are accepted for purchase in the Any and All Offer, the Maximum Tender Offer will be terminated and no 2013 Notes will be accepted for purchase.  

The following table sets forth some of the terms of the Maximum Tender Offer:

Title of Security

CUSIP Number

Principal Amount Outstanding

Reference

U.S. Treasury Security

Bloomberg Reference Page(1)

Fixed Spread (Basis Points)

Early Tender Payment(2)

6.15% Notes due 2013

65473QAK9

$545,000,000

0.625% UST due 02/28/13

PX4

80

$30

(1) The applicable page on Bloomberg from which the Dealer Manager will quote the bid side prices of the applicable Reference U.S. Treasury Security.

(2) Per $1,000 principal amount of notes validly tendered before 5:00 p.m., New York City time, on November 22, 2011, not validly withdrawn and accepted for purchase.

The Maximum Tender Offer is scheduled to expire on the Expiration Date.  Holders of 2013 Notes that are validly tendered on or prior to the Early Participation Date, and not subsequently validly withdrawn, will receive as consideration for their 2013 Notes an amount which includes an early tender payment.  Holders who validly tender their notes after the Early Participation Date, but before the Expiration Date, will receive as consideration for their 2013 Notes an amount which does not include the early tender payment.  Tenders of 2013 Notes may be validly withdrawn at any time up to the Withdrawal Date.

The total consideration for each $1,000 principal amount of 2013 Notes validly tendered and accepted for payment pursuant to the Maximum Tender Offer will be determined in the manner described in the Offer to Purchase by reference to the fixed spread over the yield to maturity of the applicable U.S. Treasury Security specified for the 2013 Notes on the cover page of the Offer to Purchase.

If 2013 Notes are accepted for purchase and the aggregate principal amount of 2013 Notes tendered exceeds the Maximum Tender Offer Amount, NiSource Finance will accept 2013 Notes on a pro rata basis.

In addition to the consideration amounts described above, holders whose 2013 Notes are accepted for purchase will receive accrued and unpaid interest up to, but not including, the settlement date, which is expected to be one business day after the Expiration Date.

The offers are subject to the satisfaction or waiver of certain conditions set forth in the Offer to Purchase, including, among other things, the issuance by NiSource Finance of at least $500 million aggregate principal amount of two new series of long-term debt securities in accordance with the terms of the financing condition more fully described in the Offer to Purchase.

The complete terms and conditions of the offers are set forth in the Offer to Purchase and the related Letter of Transmittal.  Holders of the 2016 Notes and the 2013 Notes are urged to read these documents carefully before making any decision with respect to the tender offers.

Questions regarding the tender offers may be directed to the dealer manager, Citigroup at (212) 723-6106 (collect) or (800) 558-3745 (toll-free).  Requests for documents may be directed to the information agent and depositary, Global Bondholder Services Corporation at (212) 430-3774 (for banks and brokers) or (866) 540-1500 (toll-free).

This news release is for informational purposes only and does not constitute an offer to purchase or a solicitation of an offer to sell with respect to the 2016 Notes or the 2013 Notes, nor is this news release an offer to sell, a solicitation to buy or an offer to purchase or sell any securities.  The tender offers are being made only pursuant to the Offer to Purchase and related Letter of Transmittal and only in such jurisdictions as is permitted under applicable law.

About NiSource

NiSource Inc. (NYSE: NI), based in Merrillville, Ind., is a Fortune 500 company engaged in natural gas transmission, storage and distribution, as well as electric generation, transmission and distribution. NiSource operating companies deliver energy to 3.7 million customers located within the high-demand energy corridor stretching from the Gulf Coast through the Midwest to New England. Together, NiSource's gas transmission and storage companies operate a 15,000-mile network of natural gas pipelines, 37 storage fields and serve some of the nation's largest and fastest-growing energy markets in the Northeast, Midwest and Mid-Atlantic regions.  Information about NiSource and its subsidiaries is available via the Internet at www.nisource.com. NI-F

Forward-Looking Statements

This news release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  Those statements include statements regarding the intent, belief or current expectations of NiSource and its management.  Although NiSource believes that its expectations are based on reasonable assumptions, it can give no assurance that its goals will be achieved.  Readers are cautioned that the forward-looking statements in this news release are not guarantees of future performance and involve a number of risks and uncertainties, and that actual results could differ materially from those indicated by such forward-looking statements.  Important factors that could cause actual results to differ materially from those indicated by such forward-looking statements include, but are not limited to, the following: weather; fluctuations in supply and demand for energy commodities; growth opportunities for NiSource's businesses; increased competition in deregulated energy markets; the success of regulatory and commercial initiatives; dealings with third parties over whom NiSource has no control; actual operating experience of NiSource's assets; the regulatory process; regulatory and legislative changes; the impact of potential new environmental laws or regulations; the results of material litigation; changes in pension funding requirements; changes in general economic, capital and commodity market conditions; and counter-party credit risk, and the matters set forth in the "Risk Factors" section in NiSource's 2010 Form 10-K and 2011 Forms 10-Q, many of which risks are beyond the control of NiSource.  NiSource expressly disclaims a duty to update any of the forward-looking statements contained in this release.

SOURCE NiSource Inc.



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