Canada Pension Plan buys shares at $7.16 apiece to fund acquisition
By Devika Patel
Knoxville, Tenn., Oct. 22 - Halcon Resources Corp. said it has arranged a private placement of stock with Canada Pension Plan Investment Board to raise $300 million.
The company will sell common shares at $7.16 apiece to the investor. The price per share is a 1.27% premium to the Oct. 19 closing share price of $7.07.
Proceeds will be used for general corporate purposes and future growth.
The company also announced that it has negotiated a definitive agreement with Petro-Hunt, LLC to acquire oil and gas assets in the Williston Basin for about $1.45 billion, consisting of $700 million in cash and $750 million in equity. The $750 million equity consideration will be issued as preferred stock that will automatically convert into common stock at $7.45 per share, a 5.38% premium to the Oct. 19 closing price. The placement is conditional upon the acquisition settling.
Halcon also has secured financing commitments from Wells Fargo, J.P. Morgan, Goldman Sachs and Barclays to increase the borrowing base under the company's senior secured revolving credit facility to $850 million. The banks have also agreed to provide a $500 million bridge loan.
Halcon Resources is a Houston-based independent energy company engaged in the acquisition, production, exploration and development of onshore oil and natural gas properties.
| Issuer: | Halcon Resources Corp.
|
| Issue: | Common stock
|
| Amount: | $300 million
|
| Price: | $7.16
|
| Warrants: | No
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| Investor: | Canada Pension Plan Investment Board
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| Pricing date: | Oct. 22
|
| Stock symbol: | NYSE: HK
|
| Stock price: | $7.07 at close Oct. 19
|
| Market capitalization: | $1.51 billion
|
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