Nuevo Energy buys $150 million 9 3/8% notes in tender, redeems Tecons

New York, June 30 - Nuevo Energy Co. said it completed the purchase of all $150 million of its outstanding 9 3/8% senior subordinated notes due 2010 in its tender offer.

It paid $1,150.08 per $1,000 principal amount made up of the tender price of $1,107.16, accrued interest through June 29 of $22.92 and the consent payment of $20.

Nuevo also said it redeemed in full its outstanding 5.75% convertible subordinated debentures due 2026 in the Tecon structure issued by its Nuevo Financing I subsidiary.

Nuevo said on June 15 it had extended its tender offer for the 9 3/8% notes to midnight ET on June 28.

The company said that as of June 11, $149.918 million of the notes had been tendered for purchase and not withdrawn, slightly more than the $149.9 million total announced on May 27, following expiration of the consent deadline.

As previously announced, Nuevo Energy - a wholly owned subsidiary of Plains Exploration & Production Co. (Ba2/B+), a Houston-based independent oil and gas exploration and production company - said on May 17 that it had begun a cash tender offer for any and all of its outstanding $150 million principal amount of 9 3/8% notes and was also soliciting consents to amend the notes' indenture to eliminate certain restrictive covenants and related provisions.

Nuevo set a now-expired consent deadline of 5 p.m. ET May 27 and said the tender offer would expire at midnight ET June 14, subsequently extended. It said that holders tendering by the consent date would be required to consent to the amendments.

The company said that the amount of payment for the notes would be set on the second business day prior to the consent expiration date (i.e. May 25).

The consideration would be set as the present value on the planned payment date of the call price of $1,046.875 per $1,000 principal amount on the first call date of Oct. 1, 2005, plus the present value of the interest from the payment date up to but not including the call date. That would be discounted using a yield of 75 basis points over the yield on the 1 5/8% U.S. Treasury note due Sept. 30, 2005 at 2 p.m. ET on the pricing date. The figure would include a $20 per $1,000 consent payment only payable to holders tendering their notes by the consent date, and accrued interest up to but not including the payment date. Holders tendering notes after the consent date would not receive the consent payment as part of their eventual consideration.

Nuevo said that the offer would be subject to conditions, including the now fulfilled requirement of receipt by the company of consents for a majority of the notes, and the continued availability under Nuevo's credit facility of enough funds to fund the tender.

On May 27, Nuevo said that it had received the necessary consents to amend the 9 3/8% notes' indenture by the previously announced consent deadline, which expired as scheduled at 5 p.m. ET on May 27, without extension. As of that time, the company had received tenders of $149.9 million of the securities.

The company, which had set the consideration holders would receive prior to the consent deadline, using the previously announced formula, said that total consideration for holders who tendered their notes by the consent deadline would be $1,127.16 per $1,000 principal amount, including the consent payment, plus accrued interest.

JP Morgan Securities is the dealer manager and consent solicitation agent (800 245-8812 or 212 270-9153). Georgeson Shareholder Communications is the information agent (banks and brokers call 212 440-9800, others 800 262-0158).

Nuevo announced the redemption of the Tecons on June 4, saying it would redeem them on June 29 at 101.726% of par plus accrued distributions.

Up to the close of business on the before the redemption date, holders can convert the Tecons into 1.4863 shares of Plains Exploration common stock. Plains stock closed at $18.35 Friday.

Nuevo Energy is a Houston-based independent oil and gas company.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.