Stone Energy plans $700 million revolver for Bois d'Arc purchase

By Sara Rosenberg

New York, April 30 - Stone Energy Corp. has received a commitment for a new revolving credit facility that has a $700 million initial borrowing base to help fund its acquisition of Bois d'Arc Energy Inc., company officials said in a conference call Wednesday.

Bank of America is the lead bank on the deal.

The company expects that, following the acquisition, it will generate significant cash flow that can be used to reduce debt, officials said, adding that they liked the revolver because they wanted the flexibility to pay down most of the facility over the next 18 to 24 months.

Under the transaction agreement, Stone in buying Bois d'Arc for $13.65 in cash and 0.165 shares of Stone common stock. The deal has an aggregate value of about $1.8 billion.

The acquisition is expected to close in the third quarter, subject to stockholder approval of Stone and Bois d'Arc, regulatory approvals and other customary conditions.

Post closing, it is anticipated that the Stone stockholders will own about 72% of the combined company, and the Bois d'Arc stockholders will own about 28% of the combined company.

Lafayette, La.-based Stone and Houston-based Bois d'Arc are oil and natural gas exploration and production companies.

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