Talisman Energy gets early tenders for $1.52 billion notes, lifts cap

By Susanna Moon

Chicago, Dec. 9 – Talisman Energy Inc. said it is now tendering for up to $1,524,531,000 principal amount of five series of its notes.

The maximum tender amount, lifted from $750 million, is equal to the amount of notes tendered as of 5 p.m. ET on Dec. 8, the early tender date, according to a company notice. Those tenders will be settled on Dec. 11.

The tender offer will continue until midnight ET on Dec. 22. Tendered notes may no longer be withdrawn, as of the early deadline. The offer began on Nov. 24.

Pricing will be set at 11 a.m. ET on Dec. 9 using a reference security plus a fixed spread, as follows, with the notes listed in order of priority acceptance level:

• $500 million 5.85% senior notes due 2037 will price using the 2.875% Treasury note due Aug. 15, 2045 plus 420 basis points for a hypothetical total purchase price of $852.23;

• $600 million 5.5% senior notes due 2042 using the 2.875% Treasury note due Aug. 15, 2045 plus 410 bps for a hypothetical total purchase price of $807.92;

• $600 million 6.25% senior notes due 2038 using the 2.875% Treasury note due Aug. 15, 2045 plus 425 bps for a hypothetical total purchase price of $888.16;

• $300 million 7.25% debentures due 2027 using the 2.25% Treasury note due Nov. 15, 2025 plus 415 bps for a hypothetical total purchase price of $1,068.51; and

• $125 million 5.75% senior notes due 2035 using the 2.875% Treasury note due Aug. 15, 2045 plus 420 bps for a hypothetical total purchase price of $847.39.

The hypothetical total payment was calculated at 11 a.m. ET on Nov. 23 assuming an early settlement date of Dec. 11.

Investors had tendered $359,879,000 of the 5.85% notes, $467,670,000 of the 5.5% notes, $468,053,000 of the 6.25% notes, $201,615,000 of the 7.25% notes and $27,314,000 of the 5.75% notes by the early deadline.

As previously announced, the total purchase price will include an early tender premium of $50.00 per $1,000 principal amount of notes tendered by the early tender deadline.

Those who tender after the early deadline will receive the total payment less the early premium.

The company also will pay accrued interest to but excluding the settlement date of Dec. 11 for early tendered notes and of Dec. 24 for remaining tenders.

Citigroup Global Markets Ltd. (800 558-3745, 212 723-6106 or +44-20-7986-8969) and J.P. Morgan Securities LLC (866 834-4666 or 212 834-3617) are the dealer managers. D.F. King & Co., Inc. (866 864-7964, 212 269-5550 or talisman@dfking.com) is the tender agent and information agent.

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

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