Ascent Resources widens talk on $1.5 billion two-part notes offering, modifies covenants

By Paul A. Harris

Portland, Ore., March 27 – Ascent Resources Utica Holdings, LLC widened guidance on its $1.5 billion two-part offering of senior notes (B3/B-) on Monday, according to market sources.

Guidance on the proposed tranche of five-year notes, which comes with two years of call protection, widened to the mid 8% area from earlier guidance of 7½% to 7¾%.

Meanwhile guidance on the proposed tranche of eight-year notes, which comes with three years of call protection, widened to the mid 9% area from earlier guidance of 8% to 8¼%.

There are also covenant changes, sources said.

Tranche sizes remain to be determined.

Books for the $1.5 billion offering stood at $250 million late Monday morning, a source said.

The deal, which is being marketed solely to qualified institutional investors, had been expected to price on Monday; however, no terms were available at press time.

J.P. Morgan Securities LLC is the lead.

ARU Finance Corp., a wholly owned subsidiary of Ascent Resources, will be the co-issuer.

The Oklahoma City-based energy company plans to use the proceeds to retire its second-lien term loan and for general corporate purpose.

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