Allis-Chalmers Energy talks $80 million add-on to 9% notes due January 2014 at 100 to 100.50

By Paul A. Harris

St. Louis, Aug. 7 - Allis-Chalmers Energy Inc. has talked an $80 million add-on to its 9% senior notes due Jan. 15, 2014 (B3/B-) at a dollar price range of 100.00 to 100.50, according to an informed source.

Books close at 12 p.m. ET on Tuesday with pricing expected thereafter.

RBC Capital Markets is the bookrunner for the offering, which is being sold via Rule 144A with registration rights and via Regulation S.

The notes become callable after Jan. 15, 2010 at 104.50, with the call premium declining to 102.25 one year later and to par on and after Jan. 15, 2012.

Proceeds, along with a concurrent follow-on equity offering of 2.5 million shares, will be used to help fund the acquisition of DLS Drilling, Logistics & Services Corp., to repay existing debt and for general corporate purposes.

The original $160 million issue priced at par on Jan. 12, 2006.

Allis-Chalmers Energy is a Houston-based provider of oilfield services and equipment to oil and gas exploration and production companies.

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