Ovintiv enters $825 million two-year term loan facility

By Mary-Katherine Stinson

Lexington, Ky., April 27 – Ovintiv Inc. entered a $825 million two-year term loan facility with Goldman Sachs Bank USA as administrative agent on April 26, according to an 8-K filing with the Securities and Exchange Commission.

The facility will be funded when certain conditions are met, including the completion of Ovintiv’s previously announced acquisition of assets from Black Swan Oil & Gas, LLC, PetroLegacy II Holdings, LLC, Piedra Energy III Holdings, LLC and Piedra Energy IV Holdings, LLC, also known as the Permian acquisition.

The term loan facility bears interest at SOFR plus a margin ranging from 100 basis points to 200 bps depending on Ovintiv’s credit ratings. There is a 0% SOFR floor.

The company must maintain a total debt-to-consolidated capitalization ratio not to exceed 60% on the last day of each fiscal quarter.

Ovintiv Canada ULC, a British Columbia corporation and wholly owned subsidiary of Ovintiv, is the guarantor for the facility.

In addition to Goldman Sachs, Morgan Stanley Senior Funding, Inc., Canadian Imperial Bank of Commerce, Citibank, NA, JPMorgan Chase Bank, NA, RBC Capital Markets and TD Securities (USA) LLC are the joint lead arrangers and bookrunners.

Morgan Stanley is also the syndication agent.

Bank of Montreal, Bank of Nova Scotia and National Bank of Canada are the documentation agents.

Proceeds of the loan will be used to partially finance the Permian acquisition.

The company is an oil and gas exploration and development company, based in Denver, Colo.

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