Altria Announces Consideration For Debt Tender Offer

Altria Group, Inc. (Altria) (NYSE: MO) today announced the reference yields, total consideration and tender offer consideration for its previously announced cash tender offer for up to $2,000,000,000 aggregate principal amount (the “Tender Cap”) of its senior unsecured notes identified in the table below (the “Notes”). The terms and conditions of the tender offer are described in the Offer to Purchase, dated August 6, 2012, and the related Letter of Transmittal.

For Notes that were validly tendered and not validly withdrawn at or prior to 5:00 p.m., New York City time, on August 17, 2012 (the “Early Tender Deadline”) and accepted for purchase, the applicable total consideration per $1,000 principal amount of each series of Notes (for each series, the “Total Consideration”) is the price determined as described in the Offer to Purchase intended to result in a yield to maturity (calculated in accordance with standard market practice) equal to the sum of (i) the yield to maturity for the applicable U.S. Treasury Reference Security specified in the table below, calculated based on the bid-side price of such U.S. Treasury Reference Security as of 11:00 a.m., New York City time, today, August 20, 2012 (being the first business day following the Early Tender Deadline), plus (ii) the applicable Fixed Spread specified in the table below. The Total Consideration includes the Early Tender Payment specified in the table below. Holders tendering their Notes after the Early Tender Deadline and at or prior to 12:00 midnight, New York City time, on Friday, August 31, 2012 (the “Expiration Date”), will be eligible to receive only the applicable Tender Offer Consideration, namely the applicable Total Consideration less the Early Tender Payment specified in the table below.
                                     
      Aggregate    

 
       
Acceptance Maximum Early

U.S. Treasury

U.S. Treasury
Fixed

Total

Tender Offer
Title of CUSIP Priority Purchase Tender Reference Reference Spread

Consideration

Consideration
Securities   Number   Level   Sublimit*   Payment**   Security   Yield   (bps)  

***
 

***
9.700%

 
Notes due

0.500% due
2018 02209SAD5 $30

July 31, 2017

0.787%
135

$1,435.83

$1,405.83
1 Not Applicable
9.250%

 
Notes due

1.750% due
2019   02209SAJ2           $30  

May 15, 2022
 

1.771%
  80    

$1,421.02
 

$1,391.02
9.950% 3.125% due
Notes due

February 15,
2038 02209SAE3 $30

2042

2.894%
235

$1,665.86

$1,635.86
2 $500,000,000
10.200% 3.125% due
Notes due

February 15,
2039   02209SAH6           $30  

2042
 

2.894%
  240    

$1,693.62
 

$1,663.62
*Applies to the aggregate principal amount of Notes with Acceptance Priority Level 2.
**Per $1,000 principal amount of Notes validly tendered and not validly withdrawn at or prior to the Early Tender Deadline and accepted for purchase.
***Per $1,000 principal amount of Notes.

Note: Pursuant to the terms of the tender offer, Altria will not purchase any of the 9.950% Notes due 2038 or the 10.200% Notes due 2039.
 

In addition, holders whose Notes are purchased in the tender offer will be paid accrued and unpaid interest on their purchased Notes from the applicable last interest payment date up to, but not including, the payment date for such purchased Notes. The payment for Notes accepted for purchase is expected to occur on the first business day after the Expiration Date. Assuming that the tender offer expires on August 31, 2012, and the conditions to the tender offer are satisfied or waived, Altria expects the payment for the purchased Notes to be made on September 4, 2012.

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