Comstock Resources gives early results, ups cap to $1.25 billion in tender offers

Chicago, March 4 – Comstock Resources, Inc. announced the early results for its cash tender offers for three series of notes and also upsized the offers to $1.25 billion in a press release on Thursday.

The company initially announced the offer at a cap of $750 million and then subsequently the same day as the launch increased the cap to $1 billion after announcing an upsize to $1 billion in its pricing of new 6¾% eight-year senior notes.

The company also increased the combined series cap for its two series of notes due 2026 to $780 million, previously at $550 million and launched at $325 million.

Tender offers

A total of approximately $1.9 billion of notes were tendered in the offers.

The company has now received tenders for $570,673,000 of the $619.4 million outstanding of 7½% senior notes due 2025 (Cusips: 223046AA8, U2201LAA1) for a total consideration of $1,048.75 per $1,000 face amount of notes. The company will accept $375 million of the notes with a proration factor of 65.7% applied, more than the $325 million cap previously announced.

Noteholders tendered $702,247,000 of the $850 million outstanding of the 9¾% senior notes due 2026 (Cusip: 205768AR5) for a total consideration of $1,102.50 per $1,000 face amount of notes. All of the notes will be accepted for purchase from this series.

The 2026 notes were coupled for the combined subcap, mentioned above, for $780 million with a second series of 9¾% senior notes due 2026 (Cusip: 205677AB3) with $850 million outstanding. In that second series, noteholders tendered $642,629,000 of the notes, of which Comstock will accept $74,819,000 of the notes for purchase. A proration factor of 11.6% will be applied. Notes are being repurchased at the same $1,102.50 per $1,000 face amount of notes.

The total consideration in each case includes an early tender premium of $30.00 per note for noteholders who tender by the early tender deadline at 5 p.m. ET on March 3, also the withdrawal deadline.

Interest will also be paid up to, but not including, the applicable settlement date.

Consent solicitation

The company is also seeking consents from noteholders to eliminate substantially all of the restrictive covenants and certain events of default under the indentures and modify certain notice requirements for redemption of the notes.

The modifications will become operative if a majority of the notes in the series are tendered and accepted for purchase.

In the event of proration, consents delivered for that series of notes shall be null and void.

Details

Early settlement is schedule for around March 4.

The final tender deadline is midnight ET on March 17. However, the notes tendered by the early date have exceeded the aggregate maximum tender amount, and no more notes are expected to be accepted for purchase.

Dealer managers for the tender offers are BofA Securities (980 388-3646, debt_advisory@bofa.com) and Wells Fargo Securities (866 309-6316, 704 410-4756).

D.F. King & Co., Inc. is the information agent and tender agent (800 384-7175, 212 269-5550, crk@dfking.com)

Comstock Resources is an independent natural gas producer based in Frisco, Tex.

© 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.