Tullow Oil offers to buy 7% notes due 2025 for up to $300 million

By Marisa Wong

Los Angeles, Nov. 15 – Tullow Oil plc is inviting holders of its $633,463,0000 outstanding 7% senior notes due 2025 (ISIN: USG91237AA87, US899415AE32) to tender their notes for purchase for cash, up to an aggregate cash consideration of $300 million, according to a notice.

Pricing will be determined through a modified Dutch auction procedure. The minimum purchase price is $900, and the maximum purchase price is $920.

The clearing price, which will be the early tender offer consideration, includes an early tender offer premium of $50 per $1,000 principal amount of notes tendered by the early tender deadline.

Holders tendering after the early deadline will only be eligible to receive the late tender offer consideration, which is the early tender offer consideration less the early tender premium.

The company will also pay accrued interest to but excluding the applicable payment date.

The company said it reserves the right to significantly increase or decrease the offer cap.

At or before the early tender deadline, tender instructions may be submitted on a non-competitive or a competitive basis. After the early deadline, only non-competitive tender instructions will be accepted.

Non-competitive tenders are tenders that do not specify a purchase price or specify a purchase price less than or equal to the minimum price, and competitive tenders are those that specify a purchase price greater than the minimum price.

If the tender offer is oversubscribed as of the early tender deadline, the company reserves the right not to accept any notes tendered after the early deadline and will accept for purchase notes tendered at or prior to the early deadline as follows: (i) first, all notes tendered with a purchase price less than the clearing price; and (ii) second, notes tendered with a purchase price equal to the clearing price on a prorated basis.

If the offer is not oversubscribed as of the early tender deadline but is oversubscribed by the expiration of the offer, then the company will accept for purchase notes tendered after the early deadline on a prorated basis.

Tender instructions are irrevocable except in limited circumstances.

The early tender deadline is 5 p.m. ET on Nov. 29.

Early acceptance will occur on Nov. 30. The early payment date, if the company chooses to have an early settlement, is expected to be Dec. 4.

The offer expires at 5 p.m. ET on Dec. 14.

Final settlement, if applicable, will occur on Dec. 20.

The company intends to fund the aggregate tender consideration with drawings under its $400 million five-year notes facility agreement with Glencore Energy UK Ltd. entered into on Nov. 11. The company plans to pay all accrued interest with cash on hand.

ING Bank NV, London Branch (+44 20 7767 6784; liability.management@ing.com) and Standard Chartered Bank (212 667-0351, +44 20 7885 5739, +852 398 38658, +65 6557 8286; liability_management@sc.com) are the lead dealer managers. Absa Bank Ltd., DNB Markets, Inc., J.P. Morgan Securities plc, Nedbank Ltd. and Standard Bank of South Africa Ltd. are co-dealer managers.

Morrow Sodali Ltd. (+852 2319 4130, +44 20 4513 6933, 203 658-9457; tullowoil@investor.morrowsodali.com; https://projects.morrowsodali.com/ tullowoilSUN) is the information and tender agent.

The company said it is carrying out the tender offer as part of its plan to optimize and proactively manage its cash, debt profile and capital structure.

Tullow is an independent oil and gas, exploration and production group based in London.

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