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Quicksilver Resources trims note offering to $525 million, revises structure, sets price talk
By Paul A. Harris
Portland, Ore., June 11 - Quicksilver Resources Inc. downsized its two part offering of notes to $525 million from $875 million, made revisions to the structure of the deal as well as covenant changes and set price talk on Tuesday, according to an informed source.
The size and structure of the senior tranche, a $200 million amount of six-year second-lien floating-rate notes (B2/CCC+), were left unchanged. The floating-rate notes are talked at a 575 basis points spread to Libor and come with a 1.25% Libor floor. The deal is also talked with 3 points of original issue discount, at 97.
The Rule 144A and Regulation S for life floating-rate notes become callable in one year at 102.
The junior tranche was downsized to $325 million from $675 million. It features eight-year senior notes (Caa2/CCC), which are talked to yield in the 11¾% area, including 3 to 4 points of OID. In a structural change the call protection for the notes was increased from four years to six years, at which time the notes will become callable at 102.
In addition to the downsizing and restructuring there were covenant changes.
Books close at noon ET on Wednesday, and the deal is set to price thereafter.
Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, TD Securities and UBS Investment Bank are the lead arrangers.
The Fort Worth, Texas-based owner and acquirer of oil and gas properties plans to use the proceeds to fund a tender offer for its senior notes due in 2015 and 2016 and its senior subordinated notes due in 2016.
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