Nexen accepts tenders for $311.91 million of 5.2% notes, 5.65% notes

By Jennifer Chiou

New York, March 25 - Nexen Inc. said it accepted tenders for $311,906,000 total of its $250 million of 5.2% senior notes due 2015 and its $250 million of 5.65% senior notes due 2017 and subsequently terminated the maximum tender offer for its $300 million of 6.2% senior notes due 2019 and its $200 million of 7.4% senior notes due 2028.

The company accepted $124,156,000 of 5.2% notes and $187.75 million of 5.65% notes for purchase.

For each $1,000 principal amount, the company said it will pay $1,101.02 for the 5.2% notes and $1,126.59 for the 5.65% notes. Holders also will receive accrued interest up to but not including the settlement date, which is set for Monday.

Pricing was set at 2 p.m. ET on March 24 using the 2.125% U.S. Treasury notes due February 2016 plus a fixed spread. The spread was 40 basis points for the 5.2% notes and 125 bps for the 5.65% notes. The reference yield was 2.098%.

As announced on March 17, the company will redeem all $500 million of its 5.05% senior notes due 2013 on April 21.

These transactions are all in connection with Nexen's plans to reduce its debt by up to $1 billion using cash on hand. Thus far, the company said it has cut its debt by $812 million.

Nexen offered to purchase any and all of the 5.2% notes and its 5.65% notes, and in the maximum tender offer, the company was offering to buy up to $250 million, less the amount of notes purchased in the any and all offer, of its 6.2% notes and 7.4% notes.

Because the any and all offer tenders exceeded $250 million, the company did not move forward with the maximum tender offer.

The any and all offer ended at 11:59 p.m. ET on March 24, and the maximum offer was to have wrapped at 11:59 p.m. ET on April 11.

The early tender deadline for the maximum offer was going to be 5 p.m. ET on March 30, and those who tendered their 6.2% notes or 7.4% notes by this time were to have received an early tender premium of $30.00 per $1,000 principal amount.

Deutsche Bank Securities Inc. (866 627-0391 or call collect 212 250-2955) and BNP Paribas Securities Corp. (888 210-4358 or call collect 212 841-3059) were the dealer managers, and D.F. King & Co., Inc. (800 578-5378 or 212 269-5550) was the depositary and information agent.

Nexen is an oil and gas company based in Calgary, Alta.

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