By Paul Deckelman
New York, May 10 – Resolute Energy Corp. priced a $125 million add-on (Caa1/B-/B+) to its existing 8½% senior notes due May 1, 2020 on Tuesday, high-yield syndicate sources said.
The notes priced at 101.625, at the midpoint of pre-deal price talk of 101.5 to 102.75. They priced to yield 7.874%.
The sources said the quickly shopped Rule 144A and Regulation S deal, being sold with registration rights, priced later in the session just hours after having been announced and were brought to market via bookrunners BMO Capital Markets Corp. and Goldman Sachs & Co.
The notes will have the same terms as the $400 million of already outstanding 8½% paper that the company originally sold. The company had priced $250 million on April, 20, 2012 at par and did a $150 million add-on tranche on Dec. 5, 2012 that priced at 101.25 to yield 8.2305%.
The outstanding notes became callable at 102.125 on May 1, and all of the notes will become callable at par on or after May 1, 2018.
There is a change-of-control put provision allowing holders to put the bonds back to the company at 101 upon such an event.
Resolute Energy, a Denver-based independent oil and natural gas exploration and production company, plans to use the new-deal proceeds and borrowings under its senior credit facility to finance the previously announced acquisition of certain producing and undeveloped oil and gas properties in the Delaware Basin in Reeves County, Texas.
However, if the Delaware Basin “Bronco Acquisition” is not consummated, Resolute intends to use the net proceeds to repay outstanding borrowings under its senior credit facility and the remaining portion for general corporate purposes, including capital expenditures.
| Issuer: | Resolute Energy Corp.
|
| Amount: | $125 million
|
| Maturity: | May 1, 2020
|
| Securities: | Add-on to existing senior notes
|
| Bookrunners: | BMO Capital Markets Corp. and Goldman Sachs & Co.
|
| Coupon: | 8½%
|
| Price: | 101.625
|
| Yield: | 7.874%
|
| Spread: | 630 bps versus 3½% Treasuries due May 15, 2020
|
| Call protection: | Currently callable at 102.125, will become callable at par on or after May 1, 2018
|
| Change-of-control put: | 101%
|
| Trade date: | May 9
|
| Settlement date: | May 12 (T+3)
|
| Ratings: | Moody’s: Caa1
|
| S&P: B-
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| Fitch: B+
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| Distribution: | Rule 144A and Regulation S with registration rights
|
| Price talk: | 101.5 to 101.75
|
| Marketing: | Quick to market
|
| Original issue: | $400 million priced on April 20, 2012 at par and a previous $150 million add-on priced on Dec. 5, 2012 at 101.25
|
| Total amount: | $675 million
|
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