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Published on 10/23/2018 in the Prospect News High Yield Daily and Prospect News Liability Management Daily.

Point Resources aims to call $300 million 8˝% bonds for Eni merger

By Susanna Moon

Chicago, Oct. 23 – Point Resources AS is asking for holder approval to call its $300 million of 8˝% callable senior bonds due 2024 in connection with a planned merger with Eni Norge AS.

The voting deadline by written resolution will be 7 a.m. ET on Nov. 6.

Specifically, the issuer is looking to call the bonds to avoid being in technical default under the note terms, which require Point Resources Holding AS to maintain 100% direct control and ownership of the company, according to a notice by Nordic Trustee AS.

The price for redeeming the bonds under the merger call option is 115.044% of par plus accrued interest. The call price is based on the U.S. Treasury plus a make-whole premium of 50 basis points.

If the call is not approved by the required majority, the company will hold a conditional tender offer for the bonds at a price of 114.69%, which is based on the U.S. Treasury plus a make-whole premium of 65 bps.

The call price and tender price assume a settlement date of Dec. 10 and use Treasury rates as of the close of business on Oct. 19.

Finally, if the company is unable to repurchase the bonds by either the call or tender offer, the company will transfer a “sufficient” amount to a defeasance account.

Under the terms of the merger, the surviving company would be renamed Var Energi AS and be jointly owned by Eni with a 69.6% stake and HitecVision with a 30.4% stake.

The deal is expected to close by the end of the year.

The bonds were issued March 19, 2018.

Pareto Securities AS is the financial adviser.

Point Resources AS operates as an oil and gas exploration and production company based in Sandnes, Norway.


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