Suncor lifts tender cap for 10 series of notes to C$3.6 billion

By Marisa Wong

Los Angeles, Oct. 5 – Suncor Energy Inc. announced the expiration and upsizing of its and wholly owned subsidiary Suncor Energy Ventures Corp.’s Sept. 26 offers to purchase for cash any and all of 10 series of outstanding notes for up to a maximum aggregate total consideration.

Suncor has increased the maximum purchase consideration to C$3.6 billion from C$1.75 billion, according to a Tuesday press release.

By the end of the offer at 5 p.m. ET on Oct. 4, holders had tendered C$5.058 billion combined aggregate principal amount of notes, comprised of C$2.673 billion aggregate principal amount of Canadian dollar-denominated notes and $1.762 billion aggregate principal amount of U.S. dollar-denominated notes.

In addition, $15.379 million (equivalent to C$20.814 million) combined aggregate principal amount of U.S. dollar-denominated notes were tendered under guaranteed delivery procedures.

Overall, the offerors plan to accept for purchase C$3.627 billion combined aggregate principal amount of notes under the offers (excluding notes tendered under guaranteed delivery procedures).

The increased tender cap has been met with notes with acceptance priority levels 1 through 8. As a result, the offerors plan to accept for purchase all notes of those eight series and will not accept any notes with acceptance priority levels 9 and 10.

Holders had tendered the following notes, listed in order of acceptance priority level and with the consideration per $1,000 or C$1,000 principal amount, as applicable:

• $15.95 million of the $58.95 million outstanding 8.2% notes due April 1, 2027 (Cusip: 046828AA7) issued by Suncor Energy Ventures, all of which will be accepted for purchase at $1,105.94, with pricing based on the 3.125% U.S. Treasury due Aug. 31, 2027 and a fixed spread of 165 basis points;

• $110,179,000 of the $141,804,000 outstanding 6% notes due April 1, 2042 (Cusip: 13643EAH8, C18885AF7) issued by Suncor, all of which will be accepted for purchase at $942.87, with pricing calculated using the Oct. 1, 2041 par call date and based on the 3.375% U.S. Treasury due Aug. 15, 2042 and a fixed spread of 255 bps;

• C$584,818,000 of the C$700 million outstanding 3% series 5 medium-term notes due Sept. 14, 2026 (Cusip: 86721ZAM1) issued by Suncor, all of which will be accepted for purchase at C$963.61, with pricing calculated using the June 14, 2026 par call date and based on the 1.5% Government of Canada bond due June 1, 2026 and a fixed spread of 60 bps;

• C$671,257,000 of the C$750 million outstanding 3.1% series 6 medium-term notes due May 24, 2029 (Cusip: 86721ZAP4) issued by Suncor, all of which will be accepted for purchase at C$926.56, with pricing calculated using the Feb. 24, 2029 par call date and based on the 2.25% Government of Canada bond due June 1, 2029 and a fixed spread of 125 bps;

• C$320,876,000 of the C$600 million outstanding 5.39% series 4 medium-term notes due March 26, 2037 (Cusip: 86721ZAB5) issued by Suncor, all of which will be accepted for purchase at C$1,012.53, with pricing based on the 1.75% Government of Canada bond due Dec. 1, 2053 and a fixed spread of 215 bps;

• C$1,095,959,000 of the C$1.25 billion outstanding 5% series 7 medium-term notes due April 9, 2030 (Cusip: 86721ZAQ2) issued by Suncor, all of which will be accepted for purchase at C$1,020.48, with pricing calculated using the Jan. 9, 2030 par call date and based on the 1.25% Government of Canada bond due June 1, 2030 and a fixed spread of 155 bps;

• $178,013,000 (excluding $6,000 tendered under guaranteed delivery procedures) of the $300 million outstanding 5.35% notes due July 15, 2033 (Cusip: 716442AH1) issued by Suncor, all of which will be accepted for purchase at $970.38, with pricing based on the 2.75% U.S. Treasury due Aug. 15, 2032 and a fixed spread of 210 bps;

• $400,729,000 (excluding $226,000 tendered under guaranteed delivery procedures) of the $600 million outstanding 5.95% notes due May 15, 2035 (Cusip: 71644EAG7) issued by Suncor, all of which will be accepted for purchase at $1,011.34, with pricing based on the 2.75% U.S. Treasury due Aug. 15, 2032 and a fixed spread of 220 bps;

• $346,869,000 (excluding $767,000 tendered under guaranteed delivery procedures) of the $500 million outstanding 5.95% notes due Dec. 1, 2034 (Cusip: 867229AD8) issued by Suncor, none of which will be accepted for purchase. The purchase price for the series was set at $1,015.39, based on the 2.75% U.S. Treasury due Aug. 15, 2032 and a fixed spread of 215 bps; and

• $710,596,000 (excluding $14.38 million tendered under guaranteed delivery procedures) of the $1.15 billion outstanding 6.5% notes due June 15, 2038 (Cusip: 867229AE6) issued by Suncor, none of which will be accepted for purchase. The purchase price for the series was set at $1,032.55, based on the 3.375% U.S. Treasury due Aug. 15, 2042 and a fixed spread of 220 bps.

Pricing was determined at 2 p.m. ET on Oct. 4.

In addition to the total consideration, holders whose notes are accepted for purchase will receive a cash payment equal to accrued interest to but excluding the settlement date.

Tenders under guaranteed delivery procedures are due by 5 p.m. ET on Oct. 6.

Settlement is expected to be on Oct. 7.

No series will be subject to proration in the amount accepted.

CIBC World Markets Corp. and CIBC World Markets Inc. (solely for the Canadian dollar notes), collectively CIBC (800 282-0822 or 212 455-6427); J.P. Morgan Securities LLC and J.P. Morgan Securities Canada Inc. (solely for the Canadian dollar notes), collectively JPMorgan (866 834-4666 or 212 834-2064); RBC Capital Markets, LLC and RBC Dominion Securities Inc. (solely for the Canadian dollar notes), collectively RBC (877 381-2099, 212 618-7843 or 416 842-6311); and TD Securities (USA) LLC and TD Securities Inc. (solely for the Canadian dollar notes), collectively TD Securities (866 584-2096, 212 827-2842 or 416 982-2243) are acting as the joint dealer managers for the offers.

Global Bondholder Services Corp. is the tender agent for the U.S. dollar note offers.

Computershare Investor Services Inc. is the tender agent for the Canadian dollar note offers.

Questions relating to the offers may be directed to Global Bondholder Services (855 654-2014 or 212 430-3774; https://www.gbsc-usa.com/suncor).

Suncor is an energy company based in Calgary, Alta.

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