Sequa/Tellus announces up to $475 million second-lien bonds backing stake in Gina Krog

By Paul A. Harris

Portland, Ore., March 16– Sequa/Tellus announced in a Wednesday press release that it plans to issue $475 million of secured bonds.

The offering includes $200 million of Tellus Petroleum AS second-lien senior secured high-yield bonds due 2021 via lead manager and bookrunner Anoa Capital SA.

In addition Sequa Petroleum NV announced $275 million of senior secured first-lien bonds due 2019.

Proceeds will be used to finance the acquisition of a 15% interest in the Gina Krog field.

Sapinda companies, as strategic shareholders, have provided $123 million in equity funding commitments to the company, of which about $80 million will be used to complete the transaction, with the remainder available for ongoing corporate costs.

As part of the funding process, Sequa will be seeking consents from holders of its outstanding $204.4 million existing convertible bonds due 2020 and issued in April 2015. These consents will allow the company and its subsidiaries to provide all security interests required for the proposed financing structure, and to extend the maturity date of the existing convertible bonds to April 29, 2022.

The issuance of the new bonds is conditional on the successful completion of the consent.

Sequa Petroleum is a Netherlands-based energy company. Norway-based Tellus is its wholly owned subsidiary.

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