Commentary & Deal Flow

Final Books >£2.2bn. Peak book >£2.9bn (pre-rec)

Launched: PerpNC7: £500m @ 7.125% - Orderbook >£2.9bn (pre-rec)
Book Update: Orderbook >£2bn
IPTs: PerpNC7: 7.625%a

• Issuer: Legal & General Group Plc (Ticker: LGEN)
• LEI: 213800JH9QQWHLO99821
• Issuer Rating: A2/A/A+ (Moody's/S&P/Fitch)
• Expected Issue Ratings: Baa2/BBB+ (Moody's/Fitch)
• Description: Fixed Rate Reset Perpetual Restricted Tier 1 Contingent Convertible Notes (“Notes”)
• Status / Subordination: Direct, unsecured and subordinated obligations of the Issuer, ranking pari passu and without preference among themselves. Prior to a Conversion Trigger Event, subordinated to claims of all Senior Creditors (including (a) unsubordinated creditors and (b) subordinated creditors other than those whose claims constitute or would, but for any applicable limitation on the amount of such capital, constitute (i) Tier 1 Capital of the Issuer or (ii) claims otherwise ranking, or expressed to rank, pari passu with, or junior to, the claims of the Noteholders) and senior to Ordinary Shares of the Issuer
• Format: Reg S only
• Size: £500m
• Settlement: 07-Jul-26 (T+5)
• Maturity: Perpetual
• Issuer Call Option: On (i) any day falling in the period commencing on (and including) 07-Jan-33 and ending on (and including) the First Reset Date (6 month par call) or (ii) on any Reset Date thereafter, at par and subject to certain conditions
• Reset Dates: 07-Jul-33 (“First Reset Date”) and on each fifth anniversary of the First Reset Date thereafter
• Coupon: 7.125% per annum until the First Reset Date, payable semi-annually in arrear on 7 January and 7 July commencing 07-Jan-27. Resets on each Reset Date to the relevant 5-year Gilt yield plus the initial credit spread (no step-up)
• Interest Cancellation: Optional cancellation (in whole or in part) at any time at the discretion of the Issuer and mandatory cancellation upon (i) non-compliance with applicable Solvency Capital Requirement (SCR), Minimum Capital Requirement (MCR) or Solvency Condition; (ii) insufficient Distributable Items; (iii) as otherwise required by the Relevant Regulator or under the Relevant Rules. All cancelled interest payments are non-cumulative
• Early Redemption Events: Subject to certain conditions, at par (in whole only) upon the occurrence of a (i) Tax Event, (ii) Capital Disqualification Event, (iii) Ratings Methodology Event. Clean-up call option at par applies if 75% or more of the Notes originally issued have been purchased by the Issuer
• Substitution or Variation: Applicable upon a Tax Event, a Capital Disqualification Event, a Ratings Methodology Event; subject to certain conditions as set out in the Documentation, including new terms not being materially less favourable to Noteholders
• Issuer Substitution: Substitution in place of the Issuer of: (i) Newco, in respect of a Newco Scheme; (ii) the Issuer’s successor in business; and/or (iii) the Group Holding Company, if the Issuer ceases, has ceased, or will cease, to be the Group Holding Company, in each case subject to the Regulatory Clearance Condition having been satisfied in respect of such proposed substitution
• Conditions to Redemption: To the extent required under the Relevant Rules, any redemption or purchase of the Notes is subject to: (i) if within the first 5 years, funded from the proceeds of a new issuance of, or the Notes being exchanged into Tier 1 Own Funds of the same or higher quality or (in the case of a Tax Event or a Capital Disqualification Event) the Relevant Regulator is satisfied that the SCR will be exceeded by an appropriate margin immediately after such redemption; (ii) if between year 5 to 10, the Relevant Regulator being satisfied that the SCR will be exceeded by an appropriate margin or the Notes being replaced with or exchanged into Tier 1 Own Funds of the same or higher quality; (iii) the Solvency Condition being met; (iv) the SCR being met; (v) the MCR being met; (vi) no Insolvent Insurer Winding-up has occurred and is continuing; (vii) the applicable Regulatory Clearance Condition being satisfied; (viii) any other additional or alternative requirements or pre-conditions to which the Issuer is otherwise subject and which may be imposed by the Relevant Regulator or the Relevant Rules have been complied with
• Conversion Trigger Event: If the Issuer determines at any time that: (i) eligible and available Own Fund Items ≤75% of SCR; (ii) eligible and available Own Fund Items ≤ 100% of the MCR; or (iii) breach of the SCR has occurred and has not been remedied within 3 months from the date on which the breach was first observed
• Conversion: Upon the occurrence of Conversion Trigger Event, the Notes will be converted into Ordinary Shares of the Issuer in whole and not in part at the Conversion Price
• Conversion Price: The Conversion Price per Ordinary Share in respect of the Notes is GBP 1.6310, subject to certain anti-dilution adjustments
• Conversion Shares Offer: The Issuer may at its sole and absolute discretion, elect that some or all of the Eligible Conversion Shares (being the Conversion Shares in relation to which no Opt-Out Notice has been received from Noteholders prior to the fifth Business Day preceding the commencement of the Conversion Shares Offer) to be delivered on Conversion first be offered for sale to all or some of the Issuer's Shareholders at such time, subject to certain conditions and deliver the cash proceeds thereof to Noteholders
• Listing: London Stock Exchange’s International Securities Market
• Denomination: £200,000 + £1,000
• Documentation: Preliminary Offering Memorandum dated 30-Jun-26
• Acknowledgment of Statutory Loss Absorption Powers: Applicable
• Form of Notes: Registered
• Use of Proceeds: The net proceeds of the Notes will be used for the general corporate purposes of the Group, including the refinancing of the Group’s existing securities which may include the purchase via a tender offer of (i) the outstanding USD850m 5.25% Fixed Rate Reset Subordinated Notes due 2047 and callable in 2027 (ISIN: XS1580239207); (ii) the outstanding GBP350m 5.875% Fixed Rate Senior Notes due 2031 issued by Legal & General Finance PLC and guaranteed by Legal & General Group Plc (ISIN: XS0121464779); (iii) the outstanding GBP200m 5.875% Fixed Rate Senior Notes due 2033 issued by Legal & General Finance PLC and guaranteed by Legal & General Group Plc (ISIN: XS0145680426); (iv) the outstanding GBP40m 5.750% Fixed Rate Senior Notes due 2033 issued by Legal & General Finance PLC and guaranteed by Legal & General Group Plc (ISIN: XS0126453843); and / or (v) the outstanding GBP10m 5.800% Fixed Rate Senior Notes due 2041 issued by Legal & General Finance PLC and guaranteed by Legal & General Group Plc (ISIN: XS0127393972)
• Target Market: Manufacturer target market (MiFID II / UK MiFIR product governance) is eligible counterparties and professional clients (all distribution channels). No EEA PRIIPs key information document (KID) or CCI product summary has been prepared as not available to retail in the EEA or UK. FCA CoCo Restriction applies – No sales to retail clients (as defined in COBS 3.4) in the UK
• Joint Lead Managers: Barclays, BNP Paribas, BofA Securities, Citi, HSBC (B&D), J.P. Morgan and Santander
• Governing Law: English law
• ISIN: XS3404445663
• Selling restriction: Reg S only. The notes are not intended to be sold and should not be sold to retail clients in the UK or EEA. Any sales of the Notes must be made in compliance with all applicable selling restrictions and as per the offering memorandum, in particular in Canada, Japan, European Economic Area, Singapore, United Kingdom and United States
• Timing: Books open, today’s business. Book to close 12.15pm UK.
• Fees: The Joint Lead Managers will be paid a fee in connection with the transaction. Details of the fee may be available to investors upon request
• Advertisement: The Final Offering Memorandum will be available on the websites of the Issuer at https://www.legalandgeneralgroup.com/investors/debt-investors/ and of the London Stock Exchange at http://www.londonstockexchange.com/exchange/news/market-news/market-news-home.html