Houston Exploration launches tender offer, consent solicitation for 7% notes

By Angela McDaniels

Seattle, May 2 - The Houston Exploration Co. began a cash tender offer for its $175 million 7% senior subordinated notes due 2013, according to a company news release.

The company is also soliciting consents for proposed amendments to the note indenture that would eliminate most of the restrictive covenants and events of default.

The consent deadline is 5 p.m. ET on May 21, and the tender offer will expire at 5 p.m. ET on June 5.

Houston Exploration said it will pay $1,010 plus accrued interest per $1,000 principal amount of notes tendered. Noteholders who tender by the consent deadline will receive an additional $2.50 per $1,000 principal amount.

Noteholders who tender must consent to the amendments and vice versa.

The company needs consents from holders of a majority of the notes to enact the amendments, and the tender offer is conditioned on the completion of Houston Exploration's pending merger with Forest Oil Corp.

J.P. Morgan Securities Inc. (212 270-3994) is the dealer manager, and Georgeson Inc. (800 279-7074) is the information agent.

Houston Exploration is an independent natural gas and crude oil producer based in Houston.

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