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Penn Virginia defers sale of seven-year notes over investor feedback
By Wendy Van Sickle
Columbus, Ohio, May 7 – Penn Virginia Holdings, LLC deferred its planned offering of senior notes, according to a news release Friday.
“We received indications from potential bond investors that the proposed new financing didn’t materially differentiate from our financing in place currently,” said Darrin Henke, president and chief executive officer of Penn Virginia, in the release.
“Given the strength of our balance sheet and the near-term opportunities to grow both organically and/or through consolidation, we believe it is in the best interests of our investors to defer accessing the bond market until we have a more attractive offering of scale. In the meantime, we remain committed to our focus on cash on cash returns, capital discipline, and potentially accretive consolidation opportunities.”
The company had announced a $350 million offering of seven-year senior notes (B/B) that was talked to yield in the 8¾% area, according to market sources.
Along with price talk there were covenant changes on Thursday; a roadshow for the offering started Wednesday.
Books closed at noon ET on Friday, and the Rule 144A and Regulation S for life deal was set to price thereafter.
Citigroup Global Markets Inc. is the lead bookrunner. BofA Securities Inc., CIBC World Markets Corp., Comerica Securities Inc., RBC Capital Markets LLC, Raymond James & Associates, Truist Securities Inc. and Wells Fargo Securities LLC were the joint bookrunners.
Capital One Securities Inc., EIG, Johnson Rice, Seaport Global Securities LLC and West Texas National were the co-managers.
The notes were to become callable after three years at par plus 50% of the coupon, and they featured a three-year 35% equity clawback at par plus the full coupon and a 101% poison put.
The Houston-based oil and gas company planned to use the proceeds to refinance its second-lien term loan and drawings under its RBL facility.
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