Chicago, March 16 – Centennial Resource Development Inc. sold $150 million of 3.25% seven-year exchangeable notes after the market close on Tuesday with an initial conversion premium of 30%, according to a press release.
The notes were being talked for a coupon of 2.75% to 3.25% and an initial conversion premium of 30% to 35%, according to a market source.
The notes will be issued by Centennial Resource Production LLC and exchangeable for Centennial Resource Development shares.
Citigroup Global Markets Inc., J.P. Morgan Securities LLC and Jefferies LLC are joint bookrunners for the registered offering, which carries a greenshoe of $22.5 million.
The notes are non-callable until April 7, 2025 and then subject to a 130% hurdle.
In connection with the offering, the company will enter into capped call transactions.
The notes can be settled in cash, shares or a combination of both.
Proceeds will be used to cover the cost of the call spread, to redeem in full its outstanding 8% second-lien senior secured notes due 2025 and to repay outstanding borrowings under its credit facility.
Centennial Resource is a Denver-based oil and natural gas company.
| Issuer: | Centennial Resource Production LLC
|
| Guarantor: | Centennial Resource Development Inc.
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| Issue: | Exchangeable senior notes
|
| Amount: | $150 million
|
| Greenshoe: | $22.5 million
|
| Maturity: | April 1, 2028
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| Bookrunners: | Citigroup Global Markets Inc., J.P. Morgan Securities LLC and Jefferies LLC
|
| Coupon: | 3.25%
|
| Price: | Par
|
| Conversion premium: | 30%
|
| Conversion price: | $6.28
|
| Conversion rate: | 159.261 shares
|
| Call options: | Non-callable until April 7, 2025 and then subject to a 130% hurdle
|
| Put options: | At noteholder’s election after Jan. 3, 2028
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| Pricing date: | March 16
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| Settlement date: | March 19
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| Price talk: | Coupon of 2.75% to 3.25% and an initial conversion premium of 30% to 35%
|
| Stock symbol: | Nasdaq: CDEV
|
| Stock price: | $4.83 on March 16
|
| Market cap: | $1.35 billion
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