By Rebecca Melvin
New York, June 13 - Halcon Resources Corp. sold $300 million of perpetual convertible preferred shares at a liquidation preference of $1,000 to yield 5.75% with an initial conversion premium of 20%, according to a syndicate source.
Pricing came at the cheap end of talk, which was for a 5.25% to 5.75% dividend and a 20% to 25% premium. The securities priced ahead of schedule before the market open Thursday instead of after the market close as initially expected.
The registered, off-the-shelf deal has a $45 million greenshoe and was sold via joint bookrunning managers J.P. Morgan Securities LLC and Barclays.
The series A preferreds are non-callable until June 6, 2018 and then are provisionally convertible if shares exceed 150% of the conversion price. There are no puts. They have takeover and dividend protection.
The preferreds will not be listed.
The company plans to use the proceeds to repay a portion of its outstanding borrowings under its senior secured revolving credit facility.
Houston-based Halcon is an oil and gas exploration and production company.
| Issuer: | Halcon Resources Corp.
|
| Issue: | Perpetual convertible preferred stock
|
| Amount: | $300 million
|
| Greenshoe: | $45 million
|
| Maturity: | Perpetual
|
| Bookrunners: | J.P. Morgan Securities LLC, Barclays
|
| Dividend: | 5.75%
|
| Liquidations preference: $1,000 per share
|
| Yield: | 5.75%
|
| Conversion premium: | 20%
|
| Conversion price: | $6.16
|
| Conversion ratio: | 162.4431
|
| Calls: | Non-callable until June 6, 2018, then provisionally at 150% price hurdle
|
| Puts: | No puts
|
| Takeover protection: | Yes
|
| Dividend protection: | Yes
|
| Price talk: | 5.25%-5.75%, up 20%-25%
|
| Pricing date: | June 12
|
| Settlement date: | June 18
|
| Stock symbol: | NYSE: HK
|
| Stock reference price: | $5.13 as of close June 12
|
| Distribution: | Registered, off the shelf
|
| Market capitalization: | $1.9 billion
|
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