Apache wraps tender offer for $850 million of two note series

By Toni Weeks

San Luis Obispo, Calif., Dec. 20 - Apache Corp. said investors had tendered $1,332,051,000 of notes by 11:59 p.m. ET on Dec. 19, the expiration date for the company's tender offer for two series of notes.

Apache began a tender offer for a total of up to $850 million of its 2.625% notes due 2023 and 3.25% notes due 2022 as well as three other notes series on Nov. 26. The company announced on Dec. 6 that the offer was oversubscribed, then canceled the offer for the latter three series.

By the expiration date, the company received tenders for $669,203,000 of 2.625% notes and $662,848,000 of 3.25% notes, slightly higher than the $668,616,000 and $661,774,000 of tenders, respectively, received by 5 p.m. ET on Dec. 5, the offer's early deadline.

Of the amounts tendered, Apache will accept for purchase all of the 2.625% notes and $180,797,000 of the 3.25% notes. Notes tendered in the offer that were not accepted for purchase due to proration will be returned promptly to the tending holders, the company said.

As previously reported, pricing was set at 2 p.m. ET on Dec. 6 using the yield on the bid-side price of a U.S. Treasury reference security, which was the 2.75% Treasury note due Nov. 15, 2023, plus a fixed spread of 65 basis points for the 2.625% notes and 50 bps for the 3.25% notes.

The total purchase price for each $1,000 principal amount is $931.31 for the 2.625% notes and $991.86 for the 3.25% notes.

The total payout includes an early tender payment of $30 per $1,000 principal amount of notes tendered by the early deadline.

The company is also paying accrued interest up to but excluding the settlement date, which is slated for Dec. 20.

The tender offer was not conditioned on any minimum amount of notes being tendered.

The dealer managers were Citigroup Global Markets Inc. (800 558-3745 or 212 723-6106), J.P. Morgan Securities LLC (866 834-4666 or 212 834-4811) and RBS Securities Inc. (877 297-9832 or 203 897-4825). The tender agent and information agent was Global Bondholder Services Corp. (866 470-4300).

Apache is an oil and gas exploration and production company based in Houston.

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