Schlumberger prices exchange after giving early tally, raising cap

By Wendy Van Sickle

Columbus, Ohio, March 27 – Schlumberger Holdings Corp. announced pricing of its private offer to exchange three series of senior notes for a new series of notes due May 17, 2028 on Wednesday afternoon after posting early results and announcing earlier in the day that it was increasing the offer cap to $1.5 billion from $1.25 billion.

As of 5 p.m. ET on March 26, the early participation date, holders had tendered the following, with the notes listed in order of acceptance priority and with the applicable reference security and fixed spread:

• $401,268,000 of the $1.6 billion 3% senior notes due Dec. 21, 2020, with a total consideration of $1,007.54 set using the 1.75% U.S. Treasury note due Nov. 15, 2020 plus 25 basis points;

• $233,478,000 of the $850 million 3.625% senior notes due Dec. 21, 2022, with a total consideration of $1,033.07 set using the 2.375% U.S. Treasury note due March 15, 2022 plus 50 bps; and

• $873,539,000 of the $1.75 billion 4% senior notes due Dec. 21, 2025, with a total consideration of $1,043.58 set using the 2.375% U.S. Treasury note due Feb. 29, 2024 plus 110 bps.

The new notes will have a 3.9% coupon, a yield of 3.916% and a new issue price of $998.74. Pricing of the new notes was based on the 2.625% U.S. Treasury note due Feb. 29, 2029 plus 155 bps.

Based on the new issue discount, the principal amount of new notes per $1,000 of existing notes tendered for exchange by the early deadline will be $1,008.81 for the 2020 notes, $1,034.37 for the 2022 notes and $1,044.90 for the 2025 notes.

Pricing was set at 11 a.m. ET on March 27.

Because the amount of 2025 notes tendered by the early participation date was $873,539,000, the company decided to waive the $500 million tender sub-cap applicable to the 2025 notes in addition to increasing the overall tender cap. The tendered 2025 notes will still be subject to proration.

The company expects to accept all of the early tendered 2020 and 2022 notes for exchange. However, because the total amount tendered by the early participation date exceeds the upsized $1.5 billion cap, the company does not anticipate accepting any additional tenders.

The offer will expire at 11:59 p.m. ET on April 9.

For each series, an early tender premium of $50 of new notes will be paid to holders who tendered their notes for exchange by the early deadline.

The offer is conditioned on enough notes being tendered for exchange that at least $500 million of new notes would be issued to settle the exchange.

Tenders may no longer be withdrawn.

The offer is being made under Rule 144A and Regulation S.

D.F. King & Co., Inc. (877 732-3612, 212 269-5550 or slb@dfking.com) is the exchange and information agent.

Schlumberger is a Houston-based company that supplies technology, integrated project management and information solutions to customers in the oil and gas industries.

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