Occidental offers to swap 23 Anadarko notes for new notes, cash

By Marisa Wong

Los Angeles, Aug. 28 – Occidental Petroleum Corp. had begun on Aug. 15 offers to exchange any and all notes from 23 series issued by Anadarko Petroleum Corp., Anadarko Holding Co., Anadarko Finance Corp. or Kerr-McGee Corp., as applicable, for notes to be issued by Occidental and cash.

Occidental is offering to exchange the following existing notes:

• $677,035,000 4.85% senior notes due 2021 issued by Anadarko;

• $247,965,000 3.45% senior notes due 2024 issued by Anadarko;

• $650 million 6.95% senior notes due 2024 issued by Kerr-McGee;

• $310,000 7.25% debentures due 2025 issued by Anadarko;

• $1.1 billion 5.55% senior notes due 2026 issued by Anadarko;

• $111,856,000 7.5% debentures due 2026 issued by Anadarko HoldCo;

• $47.75 million 7% debentures due 2027 issued by Anadarko;

• $150 million 7.125% debentures due 2027 issued by Kerr-McGee;

• $235,133,000 7.15% debentures due 2028 issued by Anadarko HoldCo;

• $14,153,000 6.625% debentures due 2028 issued by Anadarko;

• $135,005,000 7.2% debentures due 2029 issued by Anadarko;

• $116,275,000 7.95% debentures due 2029 issued by Anadarko HoldCo;

• $900 million 7.5% senior notes due 2031 issued by Anadarko Finance;

• $500 million 7.875% senior notes due 2031 issued by Kerr-McGee;

• $1.75 billion 6.45% senior notes due 2036 issued by Anadarko;

• $2,270,600,000 (accreted amount at maturity) zero-coupon senior notes due 2036 issued by Anadarko;

• $325 million 7.95% senior notes due 2039 issued by Anadarko;

• $750 million 6.2% senior notes due 2040 issued by Anadarko;

• $625 million 4.5% senior notes due 2044 issued by Anadarko;

• $1.1 billion 6.6% senior notes due 2046 issued by Anadarko;

• $48.8 million 7.25% debentures due 2096 issued by Anadarko;

• $60.5 million 7.73% debentures due 2096 issued by Anadarko; and

• $77.97 million 7.5% debentures due 2096 issued by Anadarko HoldCo.

In connection with the exchange offers, Occidental is also soliciting consents from holders of the old notes to some proposed amendments to the corresponding indentures that will (i) eliminate substantially all of the restrictive covenants and (ii) eliminate, solely with respect to the 7.25% debentures due 2025, 7.25% debentures due 2096, 7.73% debentures due 2096, 7% debentures due 2027, 6.625% debentures due 2028, 7.2% debentures due 2029, 7.5% senior notes due 2031, 4.85% senior notes due 2021, 3.45% senior notes due 2024, 5.55% senior notes due 2026, 6.45% senior notes due 2036, zero-coupon notes, 7.95% senior notes due 2039, 6.2% senior notes due 2040, 4.5% senior notes due 2044 and 6.6% senior notes due 2046, the payment cross-default events of default in the indentures governing those notes.

The exchange offers and consent solicitations expire at 12:01 a.m. ET on Sept. 13.

In exchange for each $1,000 principal amount of old notes tendered prior to 5 p.m. ET on Aug. 28, the early participation date, holders will receive the total exchange consideration consisting of $1,000 principal amount of new Occidental notes and a cash amount of $1.00.

No additional payment will be made for a holder’s consent to the proposed amendments.

The total consideration includes an early participation premium of $30 principal amount of new notes.

In exchange for each $1,000 principal amount of old notes tendered after the early participation date but prior to the expiration date, holders will receive only the exchange consideration of $970 principal amount of new notes and the $1.00 cash amount, which is the total consideration less the early participation premium.

Each new Occidental note issued in exchange for an old note will have an interest rate and maturity that is identical to the interest rate and maturity of the tendered old note, as well as identical interest payment dates and optional redemption prices.

No accrued interest will be paid on the old notes in connection with the exchange offers. However, interest on the applicable new note will accrue from and including the most recent interest payment date of the tendered old note.

The principal amount of each new note will be rounded down, if necessary, to the nearest whole multiple of $1,000, and Occidental will pay cash equal to the remaining portion, if any, of the exchange price of that old note.

Tenders may be withdrawn at any time prior to the expiration date. Consents may be revoked at any time prior to 5 p.m. ET on Aug. 28 but not after.

The joint lead dealer managers are BofA Merrill Lynch, Citigroup, J.P. Morgan and Wells Fargo Securities.

Global Bondholder Services Corp. (866 470-3900 or 212 430-3774 for banks and brokers or contact@gbsc-usa.com) is the exchange agent and information agent.

The Woodlands, Tex.-based Anadarko was a hydrocarbon exploration company recently acquired by Houston-based Occidental.

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