Telefónica Announces Early Results of Its Previously Announced Debt Tender Offer

NOT FOR DISTRIBUTION TO ANY PERSON LOCATED OR RESIDENT IN ANY JURISDICTION IN WHICH SUCH DISTRIBUTION IS UNLAWFUL.

MADRID, Dec. 5, 2023 /PRNewswire/ -- Telefónica, S.A. ("Telefónica" or the "Guarantor") announces today the early results of the previously announced debt tender offer (the "Offer") by Telefónica Emisiones, S.A.U., a sociedad anónima unipersonal incorporated under the laws of the Kingdom of Spain ("Telefónica Emisiones"), and Telefónica Europe B.V., a besloten vennootschap incorporated under the laws of the Netherlands ("Telefónica Europe" and, together with Telefónica Emisiones, the "Offerors"), each a wholly-owned subsidiary of Telefónica, to purchase for cash the debt securities issued by the Offerors and guaranteed by Telefónica listed in the table below (collectively, the "Securities"). In the Offer, the Offerors have decided to accept an aggregate principal amount for both Offerors and all series of Securities of $500,008,000 (such amount, as amended by this press release and as may be amended further pursuant to the Offer to Purchase (as defined below), the "Maximum Tender Amount").

As of 5:00 p.m., New York City time, on December 4, 2023 (the "Early Tender Deadline"), as reported by Global Bondholder Services Corporation, the information and tender agent for the Offer, the aggregate principal amount of validly tendered (and not validly withdrawn) Securities of each series, and the respective aggregate principal amount of the Securities of such series accepted by the relevant Offeror for purchase, were as follows:

The amount of each series of Securities that has been accepted for purchase in the Offer on the Early Settlement Date (as defined below) has been determined in accordance with the Acceptance Priority Levels specified in the table above, with 1 being the highest Acceptance Priority Level and 3 being the lowest Acceptance Priority Level, subject to the Maximum Tender Amount and the relevant Sub-Caps, in the manner described in the Offer to Purchase. In particular, as the aggregate principal amount of 2038 Notes validly tendered and not validly withdrawn does not exceed the 2038 Notes Sub-Cap, and as the aggregate principal amount of 2038 Notes and 2027 Notes validly tendered and not validly withdrawn exceed the Maximum Tender Amount, the 2038 Notes will be accepted in full (without pro ration) and the 2027 Notes will be accepted on a pro rata basis within such series of Securities and will be subject to a Scaling Factor of approximately 53.625%. No 2030 Notes will be accepted for purchase. Securities not accepted for purchase will be promptly returned or credited to the Holder's account.

Holders of Securities who validly tendered their Securities at or prior to the Early Tender Deadline (and did not validly withdraw such Securities by the Withdrawal Deadline) and whose Securities were accepted for purchase will receive the applicable Total Consideration, which already includes the applicable Early Tender Premium. In addition to the applicable Total Consideration, Accrued Interest will be paid in cash on all validly tendered Securities accepted for purchase. Payment of these amounts will be made as soon as reasonably practicable following the Early Tender Deadline (such date, the "Early Settlement Date"). The Offerors expect that the Early Settlement Date will be December 7, 2023.

The Total Consideration for each series of Securities accepted for purchase will be determined in the manner described in the Offer to Purchase on December 5, 2023 at 10:00 a.m., New York City time (the "Price Determination Date") and will be announced by a separate release as soon as practicable after the Price Determination Date.

The Offer is being made upon and is subject to the terms and conditions set forth in the Offer to Purchase, dated November 20, 2023, as amended by this press release and as it may be further amended or supplemented (the "Offer to Purchase"). The Offer will expire at 5:00 p.m., New York City time, on December 19, 2023 (such date and time, as it may be extended, the "Expiration Date"), unless earlier terminated. However, because the aggregate principal amount of validly tendered Securities at or prior to the Early Tender Deadline exceeds the Maximum Tender Amount, the Offerors will not accept for purchase any Securities tendered after the Early Tender Deadline and at or prior to the Expiration Date.

Each Offeror's obligation to accept for payment and pay for the Securities validly tendered in the Offer is subject to the satisfaction or waiver of the conditions described in the Offer to Purchase.

The Offer may be amended, extended, terminated or withdrawn in whole or with respect to any series of Securities without amending, extending, terminating or withdrawing the Offer with respect to any other series of Securities.

All capitalized terms which are used but not defined in this announcement shall have the meanings ascribed to them in the Offer to Purchase.

BofA Securities Europe SA, Citigroup Global Markets Europe AG and Goldman Sachs Bank Europe SE are acting as the dealer managers (the "Dealer Managers") for the Offer. The information and tender agent is Global Bondholder Services Corporation. Copies of the Offer to Purchase and related offering materials are available via the Offer website at https://www.gbsc-usa.com/telefonica/ or by contacting the information and tender agent in New York at +1 (212) 430-3774 (banks and brokers) or +1 (855) 654-2015 (all others) or by email at [email protected]. Questions regarding the Offer should be directed to BofA Securities Europe SA at +33 1 877 01057 (Europe) or +1 (888) 292 0070 (U.S. Toll Free) or by email at [email protected], Citigroup Global Markets Europe AG at +44 20 7986 8969 (Europe), +1 212 723 6106 (U.S.) or +1 800 558 3745 (U.S. Toll Free) or by email at [email protected] or Goldman Sachs Bank Europe SE at +44 20 7774 4836 or by email at [email protected].

This announcement is for informational purposes only and shall not constitute an offer to sell, a solicitation to buy or an offer to purchase or sell any securities. The Offer is being made only pursuant to the Offer to Purchase and only in such jurisdictions as is permitted under applicable law. Please see the Offer to Purchase for certain important information on offer restrictions applicable to the Offer.

Forward-Looking Statements

Statements included in this announcement, the Offer to Purchase and the documents incorporated by reference therein regarding the future expectations, beliefs, plans, objectives, assumptions or future events or performance of Telefónica and its subsidiaries, including the Offerors (the "Telefónica Group"), that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Exchange Act, and the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are often, but not always, made through the use of words or phrases such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "outlook", "plan", "positioned", "potential", "predict", "project", "should", "strategy", "target", "will", "would" and similar expressions. These include statements regarding the Telefónica Group's intentions, beliefs or current expectations concerning, among other things, the Telefónica Group's results of operations, financial condition, liquidity, prospects, growth, strategies and the economic and business circumstances occurring from time to time in the countries and markets in which the Telefónica Group operates. All such forward-looking statements involve estimates and assumptions that are subject to risks, uncertainties and other factors that could cause actual future financial condition, performance and results to differ materially from the plans, goals, expectations and results expressed in the forward-looking statements and other financial and/or statistical data within this announcement, the Offer to Purchase and the documents incorporated by reference therein. The Telefónica Group believes that the expectations reflected in this document, the Offer to Purchase and the documents incorporated by reference therein are reasonable, but they may be affected by a wide range of variables that could cause actual results to differ materially from those currently anticipated. The risks and uncertainties involved in Telefónica Group's businesses that could affect the matters referred to in such forward-looking statements, include but are not limited to: changes in general economic, business or political conditions in the domestic or international markets in which the Telefónica Group operates or has material investments that may affect the Telefónica Group's business, financial condition, results of operations, cash flows and/or the performance of some or all of the Telefónica Group's financial indicators, including as a result of the evolution of increasing trade or geopolitical tensions in certain parts of the world, including as a result of the armed conflict in the Middle East and Ukraine, inflation, the pace of monetary stimulus withdrawal and interest-rate hikes, the worsening of the fiscal sustainability in some European countries, economic and political uncertainties in Spain, the impact of Brexit or the COVID-19 pandemic; compliance with data privacy regulations and the impact of Telefónica inability to comply with any such regulations; the impact of current, pending or future legislation and regulation in countries where Telefónica operates; changes in the Telefónica Group's competitive position, including as a result of the evolution of competition and market consolidation in the markets where the Telefónica Group operates; and risks related to other factors discussed or incorporated by reference in the Offer to Purchase, including in the sections captioned "Risk Factors" and "Recent Developments" in the 2022 Form 20-F of Telefónica, S.A.

The forward-looking statements in this announcement, the Offer to Purchase and the documents incorporated by reference therein speak only as of the date of the document in which the forward-looking statement is made, and none of Telefónica or the Offerors undertake any obligation to update or revise publicly any forward-looking statement, whether because of new information, future events or otherwise, except as required by applicable law.

European Economic Area

In any European Economic Area Member State (each, a "Relevant State"), the Offer to Purchase is only addressed to and is only directed at qualified investors in that Relevant State within the meaning of Article 2(e) of Regulation (EU) 2017/1129, of June 14, 2017, as amended (the "Prospectus Regulation"). Each person in a Relevant State who receives any communication in respect of the Offer contemplated in the Offer to Purchase will be deemed to have represented, warranted and agreed to and with each of the Dealer Managers, the Offerors and the Guarantor that it is a qualified investor within the meaning of Article 2(e) of the Prospectus Regulation.

Kingdom of Spain

Neither the Offer nor the Offer to Purchase constitute an offer of securities or the solicitation of an offer of securities in Spain which require the approval and the publication of a prospectus under Regulation (EU) 2017/1129, Spanish Law 6/2023, of March 17, on the Securities Markets and the Investment Services (Ley 6/2023, de 17 de marzo, de los Mercados de Valores y de los Servicios de Inversión), and its ancillary and related regulations. Accordingly, the Offer to Purchase has not been and will not be submitted for approval nor approved by the Spanish Securities Market Commission.

United Kingdom

The communication of the Offer to Purchase and any other documents or materials relating to the Offer is not being made by, and such documents and/or materials have not been approved, by an authorized person for the purposes of section 21 of the Financial Services and Markets Act 2000, as amended. Accordingly, such documents and/or materials are not being distributed to, and must not be passed on to, the general public in the United Kingdom. The communication of such documents and/or materials as a financial promotion is only being made to persons in the United Kingdom falling within the definition of investment professional (as defined in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Financial Promotion Order")), or to those persons who are creditors or shareholders of any Offeror or other persons falling within Article 43(2) of the Financial Promotion Order, or to any other persons to whom such documents and/ or materials may otherwise lawfully be communicated under the Financial Promotion Order.

Belgium

Neither the Offer to Purchase nor any other documents or materials relating to the Offer have been submitted to or will be submitted for approval or recognition to the Belgian Financial Services and Markets Authority ("Autorite des services et marches financiers/Autoriteit voor Financiele Diensten en Marken"). The Offer is not being made in Belgium by way of a public offering, as defined in Articles 3 §1, 1° and 6, §1 of the Belgian Law of April 1, 2007 on public takeover bids (the "Belgian Takeover Law") as amended or replaced from time to time. Accordingly, the Offer may not be advertised and the Offer will not be extended, and neither the Offer to Purchase nor any other documents or materials relating to the Offer (including any memorandum, information circular, brochure or any similar documents) has been or shall be distributed or made available, directly or indirectly, to any person in Belgium other than (i) to "qualified investors" in the sense of Article 2(e) of the Prospectus Regulation (as amended from time to time), acting on their own account, or (ii) in any circumstances set out in Article 6, §4 of the Belgian Takeover Law. Insofar as Belgium is concerned, the Offer to Purchase has been issued only for the personal use of the above qualified investors and exclusively for the purpose of the Offer. Accordingly, the information contained in the Offer to Purchase may not be used for any other purpose or disclosed to any other person in Belgium.

France

The Offer is not being made, directly or indirectly, in the Republic of France ("France") other than to qualified investors (investisseurs qualifiés) as referred to in Article L.411-2 1° of the French Code monétaire et financier and defined in Article 2(e) of the Prospectus Regulation. Neither the Offer to Purchase nor any other document or material relating to the Offer has been or shall be distributed in France other than to qualified investors (investisseurs qualifiés) and only qualified investors (investisseurs qualifiés) are eligible to participate in the Offer. The Offer to Purchase, this announcement and any other document or material relating to the Offer have not been and will not be submitted for clearance to nor approved by the Autorité des Marchés Financiers.

Italy

None of the Offer, the Offer to Purchase or any other documents or materials relating to the Offer have been or will be submitted to the clearance procedure of the Commissione Nazionale per le Società e la Borsa ("CONSOB").

The Offer is being carried out in the Republic of Italy as an exempted offer pursuant to article 101-bis, paragraph 3-bis of the Legislative Decree No. 58 of 24 February 1998, as amended (the "Financial Services Act") and article 35-bis, paragraph 4 of CONSOB Regulation No. 11971 of May 14, 1999.

Holders, or beneficial owners of the Securities, can tender some or all of their Securities pursuant to the Offer through authorized persons (such as investment firms, banks or financial intermediaries permitted to conduct such activities in Italy in accordance with the Financial Services Act, CONSOB Regulation No. 20307 of  February 15, 2018, as amended from time to time, and Legislative Decree No. 385 of September 1, 1993, as amended) and in compliance with applicable laws and regulations or with requirements imposed by CONSOB or any other Italian authority.

Each intermediary must comply with the applicable laws and regulations concerning information duties vis-à-vis its clients in connection with the Securities or the Offer.

SOURCE Telefónica, S.A.