Energy Partners sets price talk for $450 million two-part notes offer

By Paul A. Harris

St. Louis, April 16 - Energy Partners Ltd. set price talk for it $450 million two-part offering of senior unsecured notes (Caa1/B-) on Monday, according to an informed source.

The New Orleans-based independent oil and natural gas exploration and production company talked a $150 million tranche of six-year floating-rate notes at the Libor plus 500 basis points area. The floaters become callable after one year at 102.

In addition Energy Partners talked a $300 million tranche of seven-year fixed-rate notes at the 9¾% area. The fixed-rate notes come with four years of call protection.

Pricing is expected on Wednesday.

Banc of America Securities LLC is the bookrunner for the notes, which are being marketed via Rule 144A with registration rights and via Regulation S. BNP Securities, Merrill Lynch & Co., UBS Investment Bank, Friedman Billings Ramsey and Johnson Rice & Co. are the co-managers.

Proceeds, together with a new revolver, will be used to fund the tender for up to 8.7 million common shares at $23 per share and $150 million 8¾% senior notes due 2010, and to refinance the existing revolver.

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