The Notes Offering
On February 8, 2023, Elevance Health, Inc. (the “Company”) closed its sale of $500 million aggregate principal amount of its 4.900% Notes due 2026 (the “2026 Notes”), $1,000 million aggregate principal amount of its 4.750% Notes due 2033 (the “2033 Notes”) and $1,100 million aggregate principal amount of its 5.125% Notes due 2053 (the “2053 Notes” and, together with the 2026 Notes and the 2033 Notes, the “Notes”) pursuant to an Underwriting Agreement, dated January 30, 2023 (the “Underwriting Agreement”), among the Company and Goldman Sachs & Co. LLC, Barclays Capital Inc. and J.P. Morgan Securities LLC, as representatives of the several underwriters named on Exhibit A thereto (the “Underwriters”). The Notes have been registered under the Securities Act of 1933, as amended (the “Act”) pursuant to a registration statement on Form S-3 (File No. 333-249877) previously filed with the Securities and Exchange Commission under the Act.
The Company received proceeds of approximately $2,571.5 million from the sale of the Notes after deducting underwriting discounts and its offering expenses. The Company intends to use the net proceeds for working capital and for general corporate purposes, including, but not limited to, the funding of acquisitions, repayment of short-term and long-term debt and the repurchase of its common stock pursuant to its share repurchase program. The Indenture (as defined below) does not prohibit or limit the incurrence of indebtedness and other liabilities by the Company or its subsidiaries.
The Notes have been issued pursuant to an Indenture, dated as of November 21, 2017 (the “Indenture”), between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”). Interest on the 2026 Notes is payable semi-annually in arrears on February 8 and August 8 of each year, commencing August 8, 2023. Interest on the 2026 Notes will be made to the persons who are registered holders of such 2026 Notes at the close of business on the immediately preceding January 25 or July 25 (whether or not a business day). Interest on the 2033 Notes and 2053 Notes is payable semi-annually in arrears on February 15 and August 15 of each year, commencing August 15, 2023. Each interest payment on the 2033 Notes and 2053 Notes will be made to the persons who are registered holders of such 2033 Notes or 2053 Notes, as applicable, at the close of business on the immediately preceding February 1 or August 1 (whether or not a business day), as applicable. Interest, in each case, will be computed on the basis of a 360-day year of twelve 30-day months.
The Notes may be declared immediately due and payable by the Trustee or the holders of 25% of the principal amount of the Notes of the affected series if an event of default occurs under the Indenture and has not been cured. An event of default generally means that the Company (1) fails to pay the principal or any premium on a Note on its due date, (2) does not pay interest on a Note within 30 days of its due date, (3) remains in breach of any other term of the Indenture for 90 days after its receipt of written notice of such failure or (4) files for bankruptcy or certain other events in bankruptcy, insolvency or reorganization occurs.
The 2026 Notes will mature on February 8, 2026, the 2033 Notes will mature on February 15, 2033 and the 2053 Notes will mature on February 15, 2053. Prior to (i) with respect to the 2026 Notes, February 8, 2024 (two years prior to the maturity date of such Notes), (ii) with respect to the 2033 Notes, November 15, 2032 (three months prior to the maturity date of such Notes) and (iii) with respect to the 2053 Notes, August 15, 2052 (six months prior to the maturity date of such Notes) (each such date, a “Par Call Date”), the Company may redeem the applicable series of Notes at its option, in whole or in part, at any time and from time to time, at a redemption price (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of (1) (a) the sum of the present values of the remaining scheduled payments of principal and interest on the Notes to be redeemed discounted to the redemption date (assuming, in each case, that such Notes matured on their applicable Par Call Date), on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate, as defined in the Indenture, plus 15 basis points in the case of the 2026 Notes, 20 basis points in the case of the 2033 Notes and 25 basis points in the case of the 2053 Notes less (b) interest accrued to the redemption date; and (2) 100% of the principal amount of the Notes to be redeemed; plus, in either case, accrued and unpaid interest on the applicable Notes to the redemption date.
On or after the applicable Par Call Date for the 2026 Notes, the 2033 Notes and the 2053 Notes, the Company may redeem the Notes of the applicable series in whole or in part, at any time and from time to time, at a redemption price equal to 100% of the principal amount of the Notes being redeemed, plus accrued and unpaid interest thereon to such redemption date.