#Spain #Madrid #Tender Offer #Banco Santander #U.S. Securities

Banco Santander Initiates Tender Offer

Banco Santander, S.A. has officially launched a tender offer, aiming to acquire up to $850 million of its outstanding U.S. dollar-denominated Additional Tier 1 Securities. This strategic move aims to strengthen the bank's Tier 1 capital position while enhancing its liquidity and debt maturity profile.

Overview of the Offer

The offer, referred to as the 'Offer,' will enable investors to tender their 4.750% Non-Step-Up Non-Cumulative Contingent Convertible Preferred Tier 1 Securities. The offered price stands at 100.1% of the nominal amount of the securities that are accepted for purchase. The details are outlined in the Offer to Purchase published on May 27, 2026.

Key Information

• - Maximum Offer Amount: $850 million
• - Principal Amount Outstanding: $1 billion
• - Purchase Price: 100.1% of nominal amount
• - Tender Consideration: $1,001 per $1,000 of nominal amount tendered, in multiples of $200,000
• - Expiration Date: June 9, 2026

The motivation behind this tender offer is to effectively manage Banco Santander’s capital resources. By purchasing back these securities, the bank aims to reduce its overall obligation, thereby optimizing its balance sheet. Securities that are accepted through this offer will be subsequently canceled, with unaccepted securities remaining in circulation.

Tender Consideration and Conditions

Holders of the accepted securities will receive their Tender Consideration, which is calculated based on the product of the purchase price and the nominal amount of the tendered securities. Additionally, any accrued distributions on these securities will also be paid out up to the settlement date.

The acceptance of tendered securities is solely at Banco Santander's discretion. If the total valid tenders exceed the maximum offered amount, they will be accepted on a pro-rata basis. This provides assurance to participants that their submissions will have a fair chance of acceptance.

Offer Timeline

The offer commenced on May 27, 2026, with all tender instructions needing to be received by 5:00 PM (NY time) on June 9, 2026. The announcement of the accepted securities will follow on June 10, and the expected settlement is set for June 11, 2026. Importantly, tendered securities can be withdrawn at any point prior to the expiration deadline.

Funding the Tender Offer

Banco Santander’s execution of this offer will be supported by proceeds from a concurrent issuance of new AT1 securities, thus ensuring that the bank can fulfill its financial commitments arising from this operation. This new offering is anticipated to qualify as additional Tier 1 capital under the relevant banking regulations.

Given the dynamic nature of the current financial landscape, the bank has made clear that it reserves the right to modify the maximum offer amount at its discretion. This flexibility may allow Banco Santander to adapt to market conditions while executing its capital management strategy.

Conclusion

In conclusion, Banco Santander's recent announcement is a pivotal move towards reinforcing its capital structure. The tender offer not only aims to optimize liquidity but also reflects the bank's commitment to diligent financial stewardship. Investors holding the relevant securities are encouraged to consider participating in this opportunity, taking note of the various terms and conditions outlined in the Offer to Purchase.

For further details, interested parties are advised to contact the Tender Agent, D.F. King & Co., Inc. or the Dealer Manager, Santander US Capital Markets LLC, whose contact information has been provided in the original announcement.