By Paul A. Harris
Portland, Ore., July 27 – Penn Virginia Corp. priced a $400 million issue of 9¼% five-year senior notes (B/B) at 99.018 to yield 9½% on Tuesday, according to market sources.
The coupon came at the wide end of the 9% to 9¼% coupon talk. The yield printed at the wide end of the 9¼% to 9½% yield talk. The deal came at the wide end of initial guidance in the low-to-mid 9% area.
There were also covenant changes which primarily bear upon how the company may disburse cash and incur additional debt.
BofA Securities Inc. was the left bookrunner and was a joint lead bookrunner with RBC Capital Markets LLC. Additional joint bookrunners were Citigroup Global Markets Inc., Truist Securities Inc., Wells Fargo Securities LLC and CIBC World Markets Corp.
The notes are being issued via 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.
| Issuers: | Penn Virginia Escrow LLC prior to the release of proceeds from escrow and Penn Virginia Holdings, LLC thereafter
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| Amount: | $400 million
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| Maturity: | Aug. 15, 2026
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| Securities: | Senior notes
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| Left bookrunner: | BofA Securities Inc.
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| Joint bookrunners: | RBC Capital Markets LLC (joint lead), Citigroup Global Markets Inc., Truist Securities Inc., Wells Fargo Securities LLC and CIBC World Markets Corp.
|
| Senior co-managers: | Comerica Securities Inc. and Raymond James & Associates
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| Co-managers: | Apollo Global Securities LLC, Capital One Securities Inc., EIG, Johnson Rice and Seaport Global Securities LLC
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| Coupon: | 9¼%
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| Price: | 99.018
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| Yield: | 9½%
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| First call: | Aug. 15, 2023 at 106.938
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| Trade date: | July 27
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| Settlement date: | Aug. 10
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| Ratings: | S&P: B
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| Fitch: B
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| Distribution: | Rule 144A and Regulation S for life
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| Price talk: | 9% to 9¼% coupon to yield 9¼% to 9½%
|
| Marketing: | Roadshow
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