By Abigail W. Adams
Portland, Me., May 12 – Pioneer Natural Resources Co. priced an upsized $1.15 billion five-year convertible notes after the market close on Monday at par at the midpoint of talk with a coupon of 0.25% and an initial conversion premium of 30%, according to a company news release.
Price talk was for a coupon of 0% to 0.5% and an initial conversion premium of 27.5% to 32.5%, according to a market source.
Credit Suisse Securities (USA) LLC and Goldman Sachs & Co. LLC are active bookrunners for the Rule 144A offering, which carries an upsized greenshoe of $172.5 million.
The initial size of the offering was $1 billion with a greenshoe of $150 million.
The notes are non-callable until May 20, 2023 and then subject to a 130% hurdle. There is dividend protection above 55 cents a quarter and takeover protection.
The notes will be settled in cash, shares or a combination of both.
In connection with the pricing, the company will enter into capped call transactions.
Net proceeds are expected to be $1.1 billion or $1.3 billion if the greenshoe is exercised in full.
Proceeds will be used to cover the cost of the call spread, to repurchase up to $50 million of common stock and to fund a tender offer for up to $500 million of its 3.45% senior notes due 2021, 3.95% senior notes due 2022 and 7.2% senior notes due 2028.
Pioneer Natural Resources is a Dallas-based oil and gas exploration and production company.
| Issuer: | Pioneer Natural Resources Co.
|
| Securities: | Convertible senior notes
|
| Amount: | $1.15 billion
|
| Greenshoe: | $172.5 million
|
| Maturity: | May 15, 2025
|
| Bookrunners: | Credit Suisse Securities (USA) LLC and Goldman Sachs & Co. LLC
|
| Coupon: | 0.25%
|
| Price: | Par
|
| Yield: | 0.25%
|
| Conversion premium: | 30%
|
| Conversion price: | $109.88
|
| Conversion rate: | 9.1098
|
| Call options: | Non-callable until May 20, 2023 and then subject to a 130% hurdle
|
| Put options: | Upon a fundamental change
|
| Pricing date: | May 11
|
| Settlement date: | May 14
|
| Distribution: | Rule 144A
|
| Talk: | Coupon of 0% to 0.5% and initial conversion premium of 27.5% to 32.5%
|
| Stock symbol: | NYSE: PXD
|
| Stock price: | $84.44 at market close May 11
|
| Market capitalization: | $13.98 billion
|
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