Atwood begins Dutch auction tender offer for $150 million of 6˝% notes

By Marisa Wong

Morgantown, W.Va., June 24 – Atwood Oceanics, Inc. has begun a modified Dutch auction tender offer for up to $150 million of its $490,666,000 outstanding 6˝% senior notes due 2020, according to a press release.

Holders must tender their notes at or prior to 5 p.m. ET on July 8, the early tender date, in order to be eligible to receive the total consideration for their notes. The total consideration for each $1,000 principal amount will be equal to the clearing price and will include an early tender payment of $50.00 for each $1,000 principal amount.

Holders who elect to participate must specify the price they would be willing to receive in exchange for each $1,000 principal amount of notes they choose to tender. The price that holders specify for each $1,000 principal amount must be in increments of $2.50 and must be within a range of $650.00 to $750.00. Holders who do not specify a price will be deemed to have specified a price equal to the minimum offer price.

Subject to the tender cap and proration, Atwood will accept notes tendered under the offer in the order of the lowest to the highest tender prices specified and on the early acceptance date will select the single lowest price per $1,000 principal amount, the clearing price, to enable it to purchase the amount of notes equal to the tender cap.

Atwood will pay the same price for all notes tendered at or below the clearing price and accepted for purchase, except the price paid for notes tendered after the early tender date and accepted for purchase will be reduced by the early tender payment.

The company said it will also make a cash payment representing accrued interest from Feb. 1 to, but not including, the settlement date.

After the early tender date, Atwood will determine the total consideration payable for any early tendered notes it decides to accept for payment and proration, if applicable. The company said it reserves the right to settle early tendered notes on an early settlement date. If Atwood does not elect to have an early settlement date, payment will be made on the final settlement date.

The offer will expire at midnight ET at the end of July 22.

The offer is conditioned on the tender of at least $50 million of notes.

Tendered notes may be withdrawn any time at or prior to 5 p.m. ET on July 8.

If at the early tender date the amount of notes tendered at or below the clearing price exceeds the tender cap, then Atwood will accept for purchase, first, notes tendered at prices below the clearing price and, then, notes tendered at the clearing price on a prorated basis. All notes not accepted on the early acceptance date as a result of proration and all notes tendered at prices in excess of the clearing price will be rejected from the offer and will be returned to tendering holders at Atwood’s expense.

If the offer is not fully subscribed as of the early deadline, all early tendered notes may be accepted without proration. Any notes tendered after the early deadline may be accepted subject to proration if the aggregate amount of all notes tendered by the expiration date exceeds the tender cap. In addition, notes tendered by the early tender date will have priority over notes tendered after the early deadline.

Atwood said it has agreed to pay a soliciting dealer fee equal to $2.50 for each $1,000 principal amount of notes tendered and accepted for purchase to retail brokers, provided that the fee will only be paid with respect to tenders by beneficial holders whose aggregate principal amount of notes is $250,000 or less.

Credit Suisse Securities (USA) LLC (liability management group, 800 820-1653 or 212 538-2147) is the dealer manager for the offer. D.F. King & Co., Inc. (866 416-0576, 212 269-5550 or atw@dfking.com) is the information agent.

Atwood is an offshore drilling company based in Houston.

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