WPX Energy tenders for up to $500 million of notes from three series

By Marisa Wong

Morgantown, W.Va., April 3 – WPX Energy said it has begun cash tender offers to purchase up to $500 million of its outstanding $350 million 7½% senior notes due 2020, $1.1 billion 6% senior notes due 2022 and $500 million 8¼% senior notes due 2023.

The 8¼% notes have a tender sub-cap of $50 million.

The tender offers will expire at midnight ET at the end of April 30.

Holders who tender their notes at or prior to 5 p.m. ET on April 16, the early tender date, will be eligible to receive the total consideration, which includes an early tender premium of $50 per $1,000 principal amount.

The company is offering a total consideration of $1,092.50 per $1,000 of 7½% notes, $1,052.50 per $1,000 of 6% notes and $1,130 per $1,000 of 8¼% notes.

Holders tendering after the early deadline will only be eligible to receive the tender offer consideration, which is the applicable total consideration less the early tender premium. The tender offer consideration is $1,042.50 for the 7½% notes, $1,002.50 for the 6% notes and $1,080 for the 8 ¼% notes.

The company will also pay accrued interest to but excluding the applicable settlement date.

The company expects to make payment for early tendered notes that are accepted for purchase on the business day following the early tender date and settle any final tenders on the business day following the expiration date.

Tendered notes may be withdrawn at or prior to 5 p.m. ET on April 16.

Subject to the aggregate maximum tender amount, the tender sub-cap and proration, the notes accepted on any settlement date will be accepted according to their acceptance priority levels.

The 7½% notes have acceptance priority level 1, the 6% notes have acceptance priority level 2, and the 8¼% notes have acceptance priority level 3.

Notes tendered at or prior to the early tender date will be accepted for purchase with priority over notes tendered after the early deadline, regardless of the priority of the series of the later tendered notes.

Notes may be subject to proration if the aggregate principal amount for any series of notes tendered would cause the overall tender cap or tender sub-cap to be exceeded.

In addition, if the tender offers are fully subscribed as of the early tender date, holders who tender notes after the early deadline will not have any of their notes accepted for purchase, and there will be no final settlement date.

The company said it may, but is not obligated to, increase the tender cap at any time.

The offers are not conditioned on any minimum amount of notes being tendered.

The company said it intends to fund the tender offers using proceeds from a recent sale of its remaining operations in the San Juan Basin in New Mexico and, if necessary, borrowings under its revolving credit facility or proceeds from a senior unsecured note offering.

The dealer managers for the tender offers are Merrill Lynch, Pierce, Fenner & Smith Inc. (888 292-0070 or 980-388-3646) and Citigroup Global Markets Inc. (800 558-3745 or 212 723-6106).

Global Bondholder Services Corp. (866 794-2200 or 212 430-3774 for banks and brokers)is the information agent.

WPX Energy is a Tulsa, Okla., oil-focused energy company.

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