AREP Oil & Gas $700 million credit facility to launch Thursday

By Sara Rosenberg

New York, Nov. 9 - AREP Oil & Gas LLC is scheduled to hold a bank meeting on Thursday to launch its proposed $700 million credit facility, according to a market source.

Citigroup and Bear Stearns are the lead banks on the deal, with Citi the left lead.

The facility consists of a $500 million revolver talked at Libor plus 175 basis points and a $200 million second-lien term loan talked at Libor plus 350 bps, the source said.

However, the revolver borrowing base will initially be set at $335 million of availability so the company will only be paying fees on that available amount.

At close, the company plans to draw down $300 million under the revolver and the full amount under the second-lien loan.

Security for the revolver is a first-lien interest in oil and gas reserves, and security for the second-lien is second-lien interest in these reserves.

Proceeds will be used to refinance existing debt and to fund a dividend payment.

AREP Oil & Gas is an oil and gas exploration company.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.