New Issue: Chesapeake Energy prices $800 million 10-year notes at par to yield 7¼%

By Paul A. Harris

St. Louis, May 20 - Chesapeake Energy Corp. priced an $800 million issue of senior notes due Dec. 15, 2018 (Ba3/BB/) at par to yield 7¼% on Tuesday, according to a market source.

The yield was printed on the wide end of the 7% to 7¼% price talk.

Credit Suisse, Banc of America Securities LLC, Lehman Brothers, Deutsche Bank Securities and RBS Greenwich Capital were joint bookrunners for the quick-to-market notes, which were priced off the shelf.

The Oklahoma City-based oil and natural gas company will use the proceeds to pay down its credit facility, to call $300 million of its 7¾% senior notes due 2015 and for general corporate purposes.

Issuer:	Chesapeake Energy Corp.
Amount:	$800 million
Maturity:	Dec. 15, 2018
Security description:	Senior notes
Bookrunners:	Credit Suisse, Banc of America Securities LLC, Lehman Brothers, Deutsche Bank Securities, RBS Greenwich Capital
Senior co-managers:	Barclays Capital, Comerica Securities, Goldman, Sachs & Co., J.P. Morgan Securities Inc., Morgan Stanley, UBS Securities, Wachovia Securities, Wells Fargo Securities
Co-managers:	BBVA Securities, BMO Capital Markets, BNP Paribas, BOSC, Calyon Securities, Fortis Securities, Natixis Bleichroeder, Scotia Capital, SunTrust Robinson Humphrey, TD Securities, UMB Financial Services, Wedbush Morgan
Coupon:	7¼%
Price:	Par
Yield:	7¼%
Spread:	345 bps
Call option:	Non-callable with Treasuries plus 50 bps make-whole
Trade date:	May 20
Settlement date:	May 27
Ratings:	Moody's: Ba3
	Standard & Poor's: BB
Distribution:	Shelf
Price talk:	7% to 7¼%

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