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Bonanza Creek, HighPoint exchange offer doesn’t meet minimum acceptance requirement
By Rebecca Melvin
New York, March 12 – Bonanza Creek Energy Inc. will not accept any HighPoint Resources Corp. notes tendered in its offer to exchange shares of its common stock and newly issued 7½% senior notes due 2026 for HighPoint’s 7% senior notes due 2022 and 8¾% senior notes due 2025 because the minimum participation condition was not met, according to the companies’ joint news release.
Bonanza Creek was tendering for any and all of the HighPoint notes. In addition, HighPoint was soliciting, on behalf of its operating company subsidiary, consents to proposed amendments to the indentures governing the HighPoint notes.
The exchange offers and consent solicitations were being conducted in connection with Bonanza Creek’s proposed acquisition of HighPoint.
The minimum participation condition required 97.5% of the notes to be tendered. As of the expiration at 5 p.m. ET on March 11, the companies had received tenders for $312,177,000, or 89.19% of the $350 million outstanding of the 7% notes and $271,267,000, or 98.64%, of the $275 million outstanding of the 8¾% notes. A total $583,444,000, or 93.35%, of the $625 million of notes were tendered, and those notes will be promptly returned to holders.
In addition, HighPoint solicited votes from holders of its senior notes to accept or reject a pre-packaged plan of reorganization under Chapter 11 of the U.S. Bankruptcy Code, and the pre-packaged plan was accepted.
If the Bonanza Creek stockholders approve the merger, HighPoint may file voluntary petitions under Chapter 11 in the U.S. Bankruptcy Court for the District of Delaware because the necessary votes to accept the pre-packaged plan have been obtained. The consummation of the pre-packaged plan will be subject to confirmation by the court in addition to other conditions in the plan, a transaction support agreement and related transaction documents.
Epiq Corporate Restructuring LLC (855 914-4726, tabulation@epiqglobal.com) was the exchange agent and information agent for the offers, consent solicitations and voting agent for the plan solicitation.
Bonanza Creek is an independent oil and gas company, and HighPoint is a company focused on the development of oil and gas assets located in the Denver-Julesburg Basin of Colorado. Both are based in Denver.
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