Penn Virginia expected to price $400 million notes on Tuesday; initial talk low-to-mid 9% area

By Paul A. Harris

Portland, Ore., July 26 – Penn Virginia Corp. expects to price a $400 million offering of five-year senior notes on Tuesday, according to market sources.

The deal, which was set to kick off on a Monday conference call with investors, is in the market with initial guidance in the low-to-mid 9% area, a trader said.

BofA Securities Inc. is the left bookrunner. RBC Capital Markets LLC is the joint lead bookrunner. Citigroup Global Markets Inc., Truist Securities Inc., Wells Fargo Securities LLC and CIBC World Markets Corp. are the joint bookrunners.

Comerica Securities Inc. and Raymond James & Associates are the senior co-managers. Apollo Global Securities LLC, Capital One Securities Inc., EIG, Johnson Rice and Seaport Global Securities LLC are the co-managers.

The Rule 144A for life notes become callable after two years at par plus 50% of the coupon.

The issuing entities will be Penn Virginia Escrow LLC prior to the release of proceeds from escrow and Penn Virginia Holdings, LLC thereafter.

Proceeds will be released from escrow following the closing of Penn Virginia's acquisition of Lonestar Resources US Inc., whereupon they will be used to repay Lonestar's long-term debt, with the remainder plus cash on hand to repay Penn Virginia's second-lien term loan.

The notes come with a mandatory redemption provision that would go into effect after Nov. 26, 2021 if the acquisition has not closed.

Penn Virginia is a Houston-based independent oil and gas exploration and production company.

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