Weatherford begins tender offers for up to $700 million senior notes

By Marisa Wong

Madison, Wis., Sept. 16 - Weatherford International Ltd. announced that two of its subsidiaries, Weatherford International Ltd. and Weatherford International, Inc., started cash tender offers for up to $700 million of specified series of their outstanding senior debt.

The tender offers consist of two separate offers - an "any and all offer" and a "maximum tender offer."

In the any and all offer, Weatherford Delaware is offering to purchase any and all of its $350 million of outstanding 6.625% senior notes due Nov. 15, 2011.

In the maximum tender offer, Weatherford Delaware is offering to purchase its $600 million of outstanding 5.95% senior notes due June 15, 2012, and Weatherford Bermuda is offering to purchase $500 million of its outstanding 5.15% senior notes due March 15, 2013 and its $250 million of 4.95% senior notes due Oct. 15, 2013.

The principal amount of notes to be purchased in the maximum tender offer will be equal to the difference between $700 million and the principal amount of notes purchased through the any and all offer.

The amounts of each series of notes that may be purchased in the maximum tender offer are prioritized in the order listed above and may be prorated.

The any and all offer is scheduled to expire at 11:59 p.m. ET on Sept. 22, unless extended.

Holders of notes subject to the any and all offer must tender and not withdraw their notes before the any and all offer expiration time to receive the total consideration. There is no early tender premium applicable to the any and all offer.

The maximum tender offer is scheduled to expire at 5 p.m. ET on Oct. 20, unless extended.

Holders of notes subject to the maximum tender offer must tender and not withdraw their notes before the early tender date, which is 5 p.m. ET on Sept. 29, unless extended, and not validly withdraw their notes before the maximum tender offer expiration time, to receive the total consideration.

The total consideration for notes subject to the maximum tender offer includes an early tender premium of $30 per $1,000 principal amount of notes accepted for purchase.

Holders of notes subject to the maximum tender offer who validly tender their notes after the early tender date will receive the tender offer consideration, which is the total consideration minus $30 per $1,000 principal amount of notes tendered by such holder that are accepted for purchase.

Notes may be validly withdrawn at any time before their respective expiration dates.

The total consideration for each $1,000 principal amount of notes validly tendered and accepted will be determined based on a fixed spread specific to each series of the notes over the yield based on the bid-side price of a specified U.S. Treasury security, as calculated by the dealer managers at 2 p.m. ET on Sept. 22 for the any and all offer and at 2 p.m. ET on Oct. 20 for the maximum tender offer.

The fixed spread is 50 basis points for the 6.625% senior notes due 2011, 70 bps for the 5.95% senior notes due 2012, 100 bps for the 5.15% senior notes due 2013 and 140 bps for the 4.95% senior notes due 2013.

The reference U.S. Treasury security is the 1.75% Treasury note due Nov. 15, 2011 for the 6.625% notes, the 0.375% Treasury note due Aug. 31, 2012 for the 5.95% notes, the 0.75% Treasury note due Sept. 15, 2013 for the 5.15% notes and the 0.75% Treasury note due Sept. 15, 2013 for the 4.95% notes.

In addition to the total consideration or the tender offer consideration, as applicable, holders will receive accrued interest up to, but not including, the settlement date on all validly tendered notes accepted.

The settlement dates for the any and all offer and the maximum tender offer will follow promptly after the applicable expiration dates and currently are expected to be Sept. 23 and Oct. 21, respectively.

Deutsche Bank Securities Inc. (866 627-0391), Morgan Stanley & Co. Inc. (800 624-1808) and UBS Securities LLC (888 719-4210) are joint lead dealer managers, and Global Bondholder Services Corp. (866 470-3700) is the depositary and information agent for the tender offers.

Weatherford is a Geneva, Switzerland-based multinational oilfield services company.

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