Chesapeake talks $1 billion 30-year convertibles at 2.125%-2.625%, up 47.5%-52.5%, to trade Thursday

By Kenneth Lim

Boston, May 8 - Chesapeake Energy Corp. plans to price $1 billion of 30-year convertible senior notes on Thursday before the market opens, talked at a coupon of 2.125% to 2.625% and an initial conversion premium of 47.5% to 52.5%.

The convertibles will be offered at par.

There is an over-allotment option for a further $150 million.

Credit Suisse and UBS Investment Bank are the bookrunners of the registered offering.

The convertibles will be non-callable for the first 10 years. They may be put in years 10, 15, 20 and 25.

There will be a contingent conversion trigger at 125% of the conversion price. There will be contingent payment if the notes trade above a certain level.

The convertibles will have dividend and takeover protection.

There will be a cash settlement feature.

Chesapeake, an Oklahoma City-based oil and gas exploration and production company, said it will use the proceeds of the deal to repay outstanding revolving debt that bears interest at an average of 6.7%.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.