KazMunayGas wraps oversubscribed tender for $3.4 billion of six notes

By Susanna Moon

Chicago, Dec. 7 – JSC National Co. KazMunayGas said investors had tendered $5.1 billion principal amount of six series of its notes in the offer that ended at 11:59 p.m. ET on Dec. 4.

For the first-priority notes, investors had tendered $1,487,551,000 of the $2 billion 5¾% notes due April 30, 2043, unchanged since the early deadline, and $969,888,000 of the $1 billion 6% notes due Nov. 7, 2044, up from $969,388,000 as of early deadline.

All of the first-priority notes tendered by 5 p.m. ET on Nov. 19, the early tender date, were settled on Nov. 24.

KazMunayGas accepted for purchase another $700,000 principal amount of the first-priority notes, which brings the total purchase amount for the first-priority notes to $2,457,639,000, according to a company notice.

The company began the cash tender offer on Nov. 5 for up to $3.4 billion of six series of its notes.

KazMunayGas was offering to purchase any and all of the first-priority notes with pricing for each $1,000 principal amount as follows:

• For the 5¾% notes, an early price of 88.5 and a standard price of 85.5; and

• For the 6% notes, an early price of 90.5 and a standard price of 87.5.

The standard payment price is $172,277.78 for the 5¾% notes and $440,250.00 for the 6% notes.

As previously announced, holders had tendered $1,487,551,000 of the 5¾% notes and $969,388,000 of the 6% notes by the early deadline, and all of those notes were accepted for purchase.

The early payment price was $1,322,184,913.97 for the 5¾% notes and $880,042,739.46 for the 6% notes.

After settlement, there will be left outstanding $512,249,000 of the 5¾% notes and $30,112,000 of the 6% notes.

Second-priority notes

For the second-priority notes, the company will purchase $970,259,000 of the $1 billion 4.4% notes due April 30, 2023 and the $500 million 4 7/8% notes due May 7, 2025.

Investors had tendered $593,436,000 of the 4.4% notes and $376,823,000 of the 4 7/8% notes, and all of those notes were accepted for purchase.

The second-priority notes with pricing for each $1,000 principal amount are as follows:

• For the 4.4% notes, an early price of 95.5 and a standard price of 92.5; and

• For the 4 7/8% notes, an early price of 95.5 and a standard price of 92.5.

The total purchase price is $569,500,112.68 for the 4.4% notes and $361,549,892.96 for the 4 7/8% notes.

The total tally compares with tenders for $589,019,000 of the 4.4% notes and $376,823,000 of the 4 7/8% notes by the early deadline.

After settlement, the outstanding amount will be $406,564,000 for the 4.4% notes and $123,177,000 for the 4 7/8% notes.

Third-priority notes

For the third-priority notes, investors had tendered $848,206,000 of the $1.5 billion 7% notes due May 5, 2020, up from $848,106,000, and $819,433,000 of the $1.25 billion 6 3/8% notes due April 9, 2021, unchanged as of the early deadline.

The company accepted for purchase $128,563,000 of the 7% notes and $119,726,000 of the 6 3/8% notes tendered by the early deadline using a proration factor of about 0.1638095, the press release noted.

Pricing for each $1,000 principal amount is as follows:

• For the 7% notes, an early price of 107.75 and a standard price of 104.75; and

• For the 6 3/8% notes, an early price of 104.75 and a standard price of 101.75.

The purchase price will be $139,401,575.28 for the 7% notes and $126,706,275.16 for the 6 3/8% notes.

After settlement, there will remain outstanding $1,371,437,000 of the 7% notes and $1,130,274,000 of the 6 3/8% notes.

More offer details

As previously announced, holders who tendered their notes by the early deadline will receive the early price, and those who tendered their notes after the early date will receive the standard price.

The company also will pay accrued interest to but excluding the settlement date of Nov. 24 for early tendered notes and Dec. 10 for remaining tenders.

Citigroup Global Markets Ltd. (+44 20 7986 8969, 800 558-3745, 212 723-6106 or liabilitymanagement.europe@citi.com) and Credit Suisse Securities (Europe) Ltd. (+44 20 7883 8763 or liability.management@credit-suisse.com) are the dealer managers. Citibank, NA, London Branch (+44 207 508 3867, fax +44 20 3320 2405 or exchange.gats@citi.com) is the tender agent.

KazMunayGas is an Astana, Kazakhstan-based state-owned oil and gas company.

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