SM Energy to price $500 million 10-year notes in Wednesday drive-by

By Paul A. Harris

Portland, Ore., Sept. 7 – SM Energy Co. plans to price a $500 million offering of 10-year senior notes on Wednesday following a mid-morning conference call with investors, according to market sources.

Initial guidance has the deal coming with a yield in the low 7% context, a trader said.

BofA Merrill Lynch is the left bookrunner for the public offering. Wells Fargo Securities LLC, J.P. Morgan Securities LLC, Barclays, BBVA and RBC Capital Markets are joint bookrunners.

Comerica Securities is the senior co-manager. BOK, Capital One, Deutsche Bank Securities Inc., KeyBank Capital Markets, Santander, Scotia Capital, U.S. Bancorp Investments Inc., Goldman Sachs & Co. and Tudor are the co-managers.

The notes become callable after five years at par plus 50% of the coupon.

The energy company plans to use the proceeds to finance 100% of the membership interests in JPM EOC Opal, LLC and for general corporate purposes.

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