By Paul Deckelman
New York, June 23 - Petrohawk Energy Corp. priced $650 million of new seven-year senior notes Friday to yield 9 3/8%, high yield syndicate sources said.
The sources said that the 9 1/8% notes, due July 15, 2013, came at a discounted price of 98.735 in order to yield 9 3/8%. The spread was 415 basis points over the 4¼% Treasury due August 2013.
The notes have a long first coupon, with the initial pay date set for Jan. 15, 2007.
The new notes will be non-callable for the first four years.
The issue was marketed to investors through a roadshow that began on June 15 and that concluded Friday. The Rule 144A deal priced via an underwriting syndicate led by joint book-running managers Credit Suisse, Banc of America Securities, JP Morgan and BNP Paribas. Co-managers on the deal were Lehman Brothers, Morgan Stanley and Harris Nesbitt.
Petrohawk, a Houston-based oil and gas exploration and production company which develops energy properties in Texas and elsewhere in North America, is expected to use the new-deal proceeds to help fund its acquisition of KCS Energy Inc. and to refinance existing debt.
Petrohawk and KCS - also a Houston-based energy operator - announced on April 21 that the two companies would merge, creating an onshore oil and gas producer with an enterprise value of approximately $3.7 billion. The combined company - which will be one of the top ten independent exploration and production companies in the United States - will continue to be known as Petrohawk Energy Corp. KCS stockholders will receive $9 per share in cash and 1.65 shares of Petrohawk common stock for each share of KCS common stock they own, and will own approximately 50% of the combined company.
| Issuer: | Petrohawk Energy Corp.
|
| Amount: | $650 million
|
| Security description: | Senior notes
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| Bookrunners: | Credit Suisse, Banc of America Securities, JP Morgan, BNP Paribas (joint)
|
| Co-managers: | Lehman Brothers, Morgan Stanley, Harris Nesbitt
|
| Maturity: | July 15, 2013
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| Coupon: | 9 1/8%
|
| Price: | 98.735
|
| Yield: | 9 3/8%
|
| Spread: | 415 basis points over 4¼% Treasury due August 2013
|
| Call: | Non-callable for four years.
|
| Settlement: | July 12 (T+12), long first coupon, first pay date Jan. 15, 2007
|
| Ratings: | Moody's: B3
|
| S&P: B-
|
| Distribution: | Rule 144A
|
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