YBSC York Bsoc

Yorkshire Building Society announces Tender Offer for its Regulated £750,000,000 Series 15 Floating Rate Covered Bonds due November 2024

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO OR TO ANY PERSON LOCATED OR RESIDENT IN THE UNITED STATES, ITS TERRITORIES AND POSSESSIONS (INCLUDING PUERTO RICO, THE U.S. VIRGIN ISLANDS, GUAM, AMERICAN SAMOA, WAKE ISLAND AND THE NORTHERN MARIANA ISLANDS), ANY STATE OF THE UNITED STATES OR THE DISTRICT OF COLUMBIA (the United States) OR IN OR INTO OR TO ANY PERSON LOCATED OR RESIDENT IN ANY OTHER JURISDICTION WHERE OR TO WHOM IT IS UNLAWFUL TO RELEASE, PUBLISH OR DISTRIBUTE THIS DOCUMENT (SEE "OFFER AND DISTRIBUTION RESTRICTIONS" BELOW)

THIS ANNOUNCEMENT RELATES TO THE DISCLOSURE OF INFORMATION THAT QUALIFIED OR MAY HAVE QUALIFIED AS INSIDE INFORMATION WITHIN THE MEANING OF ARTICLE 7(1) OF THE MARKET ABUSE REGULATION (EU) 596/2014 AS IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 (EUWA).

14 May 2024.  Yorkshire Building Society (the Offeror) announces today its invitation to holders of its outstanding Regulated £750,000,000 Series 15 Floating Rate Covered Bonds due November 2024 (ISIN: XS2080769909) (the 2024 Covered Bonds) to tender any and all of their 2024 Covered Bonds for purchase by the Offeror for cash subject to the satisfaction (or waiver) of the New Financing Condition (as defined below) (the Offer).  The Offer is being made on the terms and subject to the conditions contained in the tender offer memorandum dated 14 May 2024 (the Tender Offer Memorandum) prepared by the Offeror for the Offer, and is subject to the offer restrictions set out below and as more fully described in the Tender Offer Memorandum.

Copies of the Tender Offer Memorandum are (subject to distribution restrictions) available from the Tender Agent as set out below. Capitalised terms used in this announcement but not defined have the meanings given to them in the Tender Offer Memorandum.

Summary of the Offer

Rationale for the Offer

The Offeror is making the Offer in order to provide liquidity to the holders of the 2024 Covered Bonds while optimising its funding and liquidity position. The Offer also provides Covered Bondholders with an opportunity to sell their 2024 Covered Bonds ahead of their maturity date and to receive, at the sole and absolute discretion of the Offeror, priority in the allocation of the New Covered Bonds (as defined below), subject to the issue of the New Covered Bonds and such Covered Bondholder making a separate application for the purchase of such New Covered Bonds to a Dealer Manager as described under "Allocation of the New Covered Bonds" below.

2024 Covered Bonds purchased by the Offeror pursuant to the Offer are expected to be cancelled and will not be re-issued or re-sold.

Purchase Price and Accrued Interest

The Offeror will, on the Settlement Date (subject to the satisfaction (or waiver) of the New Financing Condition on or prior to such date), pay for 2024 Covered Bonds validly tendered and accepted by it for purchase pursuant to the Offer a purchase price equal to 100.26 per cent. of the nominal amount of such 2024 Covered Bonds (the Purchase Price).

The Offeror will also, subject to the satisfaction (or waiver) of the New Financing Condition on or prior to the Settlement Date, pay an Accrued Interest Payment in respect of 2024 Covered Bonds accepted for purchase pursuant to the Offer.

Any and All Offer

If the Offeror decides to accept valid tenders of any 2024 Covered Bonds for purchase pursuant to the Offer, it will accept for purchase all 2024 Covered Bonds that are validly tendered in full, with no pro rata scaling, subject to the satisfaction (or waiver) of the New Financing Condition.

New Covered Bonds Offering and New Financing Condition

Alongside the Offer, the Offeror has also announced today its intention, subject to market conditions, to issue new sterling-denominated floating rate covered bonds (the New Covered Bonds), irrevocably and unconditionally guaranteed as to payments of interest and principal by Yorkshire Building Society Covered Bonds LLP (the LLP).

Whether the Offeror will purchase any 2024 Covered Bonds validly tendered in the Offer is subject, without limitation, to the successful completion (in the sole determination of the Offeror) of the issue of the New Covered Bonds (the New Financing Condition), or the waiver of such condition.

Even if the New Financing Condition is satisfied, the Offeror is under no obligation to accept for purchase any 2024 Covered Bonds tendered pursuant to the Offer. The acceptance for purchase by the Offeror of 2024 Covered Bonds validly tendered pursuant to the Offer is at the sole and absolute discretion of the Offeror, and tenders may be rejected by the Offeror for any reason.

Any investment decision to purchase any New Covered Bonds should be made solely on the basis of the information contained in (i) the prospectus dated 1 September 2023 prepared in connection with the Global Covered Bond Programme of the Offeror, as supplemented by the supplementary prospectus dated 27 March 2024 (together, the Programme Prospectus) and (ii) the final terms to be prepared in connection with the New Covered Bonds, and no reliance is to be placed on any representations other than those contained in the Programme Prospectus.

For the avoidance of doubt, the ability to purchase any New Covered Bonds is subject to all applicable securities laws and regulations in force in any relevant jurisdiction (including the jurisdiction of the relevant Covered Bondholder and the selling restrictions set out in the Programme Prospectus). It is the sole responsibility of each Covered Bondholder to satisfy itself that it is eligible to purchase the New Covered Bonds.

The New Covered Bonds and the guarantee thereof have not been, and will not be, offered or sold in the United States. Nothing in this announcement or the Tender Offer Memorandum constitutes an offer to sell or the solicitation of an offer to buy the New Covered Bonds or the guarantee thereof in the United States or any other jurisdiction.  Securities may not be offered, sold or delivered in the United States absent registration under, or an exemption from the registration requirements of, the United States Securities Act of 1933, as amended (the Securities Act).  The New Covered Bonds and the guarantee thereof have not been, and will not be, registered under the Securities Act or the securities laws of any state or other jurisdiction of the United States and may not be offered, sold or delivered, directly or indirectly, within the United States or to, or for the account or benefit of, U.S. Persons (as defined in Regulation S of the Securities Act (each a U.S. Person)).

Compliance information for the New Covered Bonds:

UK MiFIR - professionals/ECPs-only / No PRIIPs or UK PRIIPs KID - Manufacturer target market (UK MiFIR product governance) is eligible counterparties and professional clients only (all distribution channels). No PRIIPs or UK PRIIPs key information document (KID) has been or will be prepared. No sales to UK or EEA retail investors.

See the Programme Prospectus for further information.

No action has been or will be taken in any jurisdiction in relation to the New Covered Bonds or the guarantee thereof to permit a public offering of securities.

Allocation of the New Covered Bonds

When considering allocation of the New Covered Bonds, the Offeror may give preference to those Covered Bondholders that, prior to such allocation, have validly tendered or have given a firm intention to any Dealer Manager that they intend to tender their 2024 Covered Bonds for purchase pursuant to the Offer. Therefore, a Covered Bondholder that wishes to subscribe for New Covered Bonds in addition to tendering its existing 2024 Covered Bonds for purchase pursuant to the Offer may be eligible to receive, at the sole and absolute discretion of the Offeror, priority in the allocation of the New Covered Bonds, subject to the issue of the New Covered Bonds and such Covered Bondholder making a separate application for the purchase of such New Covered Bonds to a Dealer Manager (in its capacity as a joint lead manager of the issue of the New Covered Bonds) in accordance with the standard new issue procedures of such Dealer Manager. Any such preference will, subject to the sole and absolute discretion of the Offeror, be applicable up to the aggregate nominal amount of 2024 Covered Bonds tendered by such Covered Bondholder (or in respect of which such Covered Bondholder has indicated a firm intention to tender as described above) pursuant to the Offer. However, the Offeror is not obliged to allocate any New Covered Bonds to a Covered Bondholder that has validly tendered or indicated a firm intention to tender its 2024 Covered Bonds for purchase pursuant to the Offer and, if any such New Covered Bonds are allocated, the nominal amount thereof may be less or more than the nominal amount of 2024 Covered Bonds tendered by such Covered Bondholder and accepted for purchase by the Offeror pursuant to the Offer. Any such allocation will also, among other factors, take into account the minimum denomination of the New Covered Bonds (being £100,000).

All allocations of the New Covered Bonds, while being considered by the Offeror as set out above, will be made in accordance with customary new issue allocation processes and procedures in the sole and absolute discretion of the Offeror. In the event that a Covered Bondholder validly tenders 2024 Covered Bonds pursuant to the Offer, such 2024 Covered Bonds will remain subject to such tender and the conditions of the Offer as set out in the Tender Offer Memorandum irrespective of whether that Covered Bondholder receives all, part or none of any allocation of New Covered Bonds for which it has applied.

Covered Bondholders should note that the pricing and allocation of the New Covered Bonds are expected to take place prior to the Expiration Deadline for the Offer and any Covered Bondholder that wishes to subscribe for New Covered Bonds in addition to tendering 2024 Covered Bonds for purchase pursuant to the Offer should therefore provide, as soon as practicable, to any Dealer Manager any indications of a firm intention to tender 2024 Covered Bonds for purchase pursuant to the Offer and the quantum of 2024 Covered Bonds that it intends to tender.

General

The Offer begins on 14 May 2024 (the Launch Date) and will expire at 4.00 p.m. (London Time) on 21 May 2024 (the Expiration Deadline), unless extended, re-opened, amended or terminated as provided in the Tender Offer Memorandum.

In order to be eligible to receive the Purchase Price, Covered Bondholders must validly tender their 2024 Covered Bonds by the Expiration Deadline, by delivering, or arranging to have delivered on their behalf, a valid Tender Instruction that is received by the Tender Agent by the Expiration Deadline.  The relevant deadline set by any intermediary or Clearing System will be earlier than this deadline.

Tender Instructions will be irrevocable except in the limited circumstances described in the Tender Offer Memorandum.  Tender Instructions must be submitted in respect of an aggregate nominal amount of at least £100,000 (being the minimum denomination of the 2024 Covered Bonds), and may be submitted in integral multiples of £1,000 thereafter.

Indicative Timetable for the Offer

Subject to applicable law and as provided in the Tender Offer Memorandum, the Offeror may, in its sole and absolute discretion, extend, re-open, amend, waive any condition of or terminate the Offer at any time and the above times and dates are subject to the right of the Offeror to so extend, re-open, amend and/or terminate the Offer.

Covered Bondholders are advised to check with any bank, securities broker or other intermediary through which they hold 2024 Covered Bonds when such intermediary would need to receive instructions from a Covered Bondholder in order for that Covered Bondholder to be able to participate in, or (in the limited circumstances in which revocation is permitted) revoke their instruction to participate in, the Offer before the deadlines specified above and in the Tender Offer Memorandum. The deadlines set by any such intermediary and each Clearing System for the submission of Tender Instructions will be earlier than the relevant deadlines specified above and in the Tender Offer Memorandum.

Unless stated otherwise, all announcements in connection with the Offer will be made by the Offeror by (i) publication through RNS and (ii) delivery of notices to the Clearing Systems for communication to Direct Participants. Such announcements may also be made (a) on the Informa IGM Screen Insider service and/or (b) by the issue of a press release to a Notifying News Service. Copies of all such announcements, press releases and notices can also be obtained upon request from the Tender Agent, the contact details for which are set out below. Significant delays may be experienced in respect of notices delivered to the Clearing Systems and Covered Bondholders are urged to contact the Tender Agent for the relevant announcements during the course of the Offer.

Further Information

Covered Bondholders are advised to read carefully the Tender Offer Memorandum for full details of, and information on the procedures for participating in, the Offer.

Requests for information in relation to the Offer should be directed to:

Requests for information in relation to the procedures for tendering 2024 Covered Bonds in, and for any documents or materials relating to, the Offer should be directed to:

THE TENDER AGENT

Kroll Issuer Services Limited

The Shard

32 London Bridge Street

London SE1 9SG

United Kingdom

Telephone: +44 20 7704 0880

Attention: Jacek Kusion

Email: ybs@is.kroll.com

Website: https://deals.is.kroll.com/ybs

MARKET ABUSE REGULATION

This announcement is made by Yorkshire Building Society and contains information that qualified or may have qualified as inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the EUWA (UK MAR), encompassing information relating to the Offer described above. For the purposes of UK MAR and the Implementing Technical Standards, this announcement is made by Duncan Asker, Director of Treasury at Yorkshire Building Society.

DISCLAIMER

This announcement must be read in conjunction with the Tender Offer Memorandum.  This announcement and the Tender Offer Memorandum contain important information which should be read carefully before any decision is made with respect to the Offer.  If any Covered Bondholder is in any doubt as to the contents of this announcement or the Tender Offer Memorandum or the action it should take is recommended to seek its own financial, regulatory and legal advice, including in respect of any financial, accounting and tax consequences, immediately from its broker, bank manager, solicitor, accountant or other independent financial, tax, legal, regulatory, business, investment or financial and accounting adviser.  Any individual or company whose 2024 Covered Bonds are held on its behalf by a broker, dealer, bank, custodian, trust company or other nominee must contact such entity if it wishes to tender such 2024 Covered Bonds in the Offer. None of the Offeror, the LLP, the Dealer Managers or the Tender Agent (or any of their respective directors, employees, officers, agents or affiliates) expresses any opinion about the merits of the Offer or makes any recommendation whether Covered Bondholders should tender 2024 Covered Bonds in the Offer and no one has been authorised by the Offeror, the LLP, the Dealer Managers or the Tender Agent to make any such recommendation. None of the Dealer Managers, the Tender Agent, the Offeror or the LLP (or any of their respective directors, officers, employees, agents or affiliates) is providing Covered Bondholders with any legal, business, financial investment, tax, regulatory or other advice in this announcement or the Tender Offer Memorandum. Covered Bondholders should consult with their own advisers as needed to assist them in making an investment decision and to advise them whether they are legally permitted to tender 2024 Covered Bonds for purchase pursuant to the Offer.

OFFER AND DISTRIBUTION RESTRICTIONS

The distribution of this announcement and the Tender Offer Memorandum in certain jurisdictions may be restricted by law.  Persons into whose possession this announcement and/or the Tender Offer Memorandum come(s) are required by each of the Offeror, the LLP, the Dealer Managers and the Tender Agent to inform themselves about and to observe any such restrictions.  Neither this announcement nor the Tender Offer Memorandum constitutes an offer to buy or the solicitation of an offer to sell 2024 Covered Bonds (and tenders of 2024 Covered Bonds in the Offer will not be accepted from Covered Bondholders) in any circumstances in which such offer or solicitation is unlawful.  In those jurisdictions where the securities, blue sky or other laws require the Offer to be made by a licensed broker or dealer and any Dealer Manager or any of its affiliates is such a licensed broker or dealer in any such jurisdiction, the Offer shall be deemed to be made on behalf of the Offeror by such Dealer Manager or such affiliate (as the case may be) in such jurisdiction.

No action has been or will be taken in any jurisdiction in relation to the New Covered Bonds that would permit a public offering of securities and the minimum denomination of the New Covered Bonds will be £100,000.

United States.  The Offer is not being made, and will not be made, directly or indirectly, in or into, or by use of the mails of, or by any means or instrumentality of interstate or foreign commerce of, or of any facilities of a national securities exchange of, the United States. This includes, but is not limited to, facsimile transmission, electronic mail, telex, telephone, the internet and other forms of electronic communication. The 2024 Covered Bonds may not be tendered in the Offer by any such use, means, instrumentality or facility from or within the United States or by persons located or resident in the United States.  Accordingly, copies of this announcement, the Tender Offer Memorandum and any other documents or materials relating to the Offer are not being, and must not be, directly or indirectly, mailed or otherwise transmitted, distributed or forwarded (including, without limitation, by custodians, nominees or trustees) in or into the United States or to persons located or resident in the United States.  Any purported tender of 2024 Covered Bonds in the Offer resulting directly or indirectly from a violation of these restrictions will be invalid and any purported tender of 2024 Covered Bonds made by a person located in the United States or any agent, fiduciary or other intermediary acting on a non-discretionary basis for a principal giving instructions from within the United States will be invalid and will not be accepted. 

Neither this announcement nor the Tender Offer Memorandum is an offer of securities for sale in the United States or to U.S. Persons. Securities may not be offered or sold in the United States absent registration under, or an exemption from the registration requirements of, the Securities Act. The New Covered Bonds and the guarantee thereof have not been, and will not be, registered under the Securities Act or the securities laws of any state or other jurisdiction of the United States, and may not be offered, sold or delivered, directly or indirectly, within the United States or to, or for the account or benefit of, U.S. Persons.

Each holder of 2024 Covered Bonds participating in the Offer will represent that it is not located in the United States and is not participating in the Offer from the United States, or it is acting on a non-discretionary basis for a principal located outside the United States that is not giving an order to participate in the Offer from the United States. For the purposes of this and the above two paragraphs, United States means the United States of America, its territories and possessions (including Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana Islands), any state of the United States of America and the District of Columbia.

United Kingdom. This announcement and the Tender Offer Memorandum have been issued by Yorkshire Building Society of Yorkshire House, Yorkshire Drive, Bradford, West Yorkshire BD5 8LJ, United Kingdom which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority (the FCA) and the Prudential Regulation Authority.  This announcement and the Tender Offer Memorandum are only addressed to Covered Bondholders where they would (if they were clients of the Offeror) be per se professional clients or per se eligible counterparties of the Offeror within the meaning of the FCA rules. Neither this announcement nor the Tender Offer Memorandum is addressed to or directed at any persons who would be retail clients within the meaning of the FCA rules and any such persons should not act or rely on it.  Recipients of this announcement and/or the Tender Offer Memorandum should note that the Offeror is acting on its own account in relation to the Offer and will not be responsible to any other person for providing the protections which would be afforded to clients of the Offeror or for providing advice in relation to the Offer.

In addition, this announcement, the Tender Offer Memorandum and any other documents or materials relating to the Offer 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 those persons in the United Kingdom falling within the definition of investment professionals (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 within Article 43 of the Financial Promotion Order, or to any other persons to whom it may otherwise lawfully be made under the Financial Promotion Order.

Italy. None of the Offer, this announcement, the Tender Offer Memorandum or any other document or materials relating to the Offer have been or will be submitted to the clearance procedures of the Commissione Nazionale per le Società e la Borsa (CONSOB) pursuant to Italian laws and regulations.  The Offer is being carried out in 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 14 May 1999, as amended. Accordingly, Covered Bondholders or beneficial owners of the 2024 Covered Bonds that are located in Italy can tender 2024 Covered Bonds for purchase in the Offer through authorised persons (such as investment firms, banks or financial intermediaries permitted to conduct such activities in the Republic of Italy in accordance with the Financial Services Act, CONSOB Regulation No. 20307 of 15 February 2018, as amended, and Legislative Decree No. 385 of 1 September 1993, as amended) and in compliance with any other applicable laws and regulations and with any 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 2024 Covered Bonds or the Offer.

France. The Offer is not being made, directly or indirectly, to the public in the Republic of France (France). This announcement, the Tender Offer Memorandum and any other document or material relating to the Offer have only been and shall only be distributed in France to qualified investors as defined in Article 2(e) of Regulation (EU) 2017/1129, as amended.  Neither this announcement nor the Tender Offer Memorandum have been or will be submitted for clearance to nor approved by the Autorité des Marchés Financiers.