C&J Energy Services pulls $1.25 billion credit facility from market

By Sara Rosenberg

New York, Dec. 5 – C&J Energy Services Inc. is postponing syndication of its $1.25 billion credit facility to a later date as a result of unfavorable conditions.

“Given the pricing and other terms available under the committed financing arrangements, coupled with the uncertainty of current market conditions, we decided to withdraw the loan from the market for now but we may be back once conditions improve,” the company said in a written statement disclosed in an 8-K filing with the Securities and Exchange Commission.

Proceeds were going to be used to fund the company’s combination with Nabors Industries Ltd.’s completion and production services business.

C&J added that it is still able to finance the combination and “remains on track” to close the transaction in January.

The deal consisted of a $600 million revolver and a $650 million five-year senior secured term loan B.

Talk on the term loan B had been Libor plus 400 basis points with a 1% Libor floor, an original issue discount of 98 and 101 soft call protection for six months.

During the syndication process, the loan was restructured from a $300 million five-year term loan B-1, talked at Libor plus 350 bps to 375 bps with a 0.75% Libor floor and an original issue discount of 99, and a $375 million seven-year covenant-light term loan B-2, talked at Libor plus 375 bps to 400 bps with a 1% Libor floor and a discount of 99. Both tranches were launched with 101 soft call protection for six months.

Citigroup Global Markets Inc., Bank of America Merrill Lynch, Wells Fargo Securities LLC and J.P. Morgan Securities LLC were the lead arrangers on the deal. Senior co-managers were Capital One and Comerica, and co-managers are Amegy Bank, DNB, Scotia Bank and Regions Financial Corp. Bank of America was the administrative agent.

C&J is a Houston-based provider of hydraulic fracturing, coiled tubing, cased-hole wireline, pumpdown and other oilfield services.

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