By Paul A. Harris
Portland, Ore., July 20 – Comstock Resources, Inc. priced an $850 million issue of 9¾% eight-year senior notes (Caa1/B/B) at 95.988 to yield 10½% on Friday, according to an investor.
The yield printed on top of yield talk, which factored in an original issue discount.
BofA Merrill Lynch was the left bookrunner. BMO Capital Markets Corp., Fifth Third Securities Inc., Capital One Securities Inc., Regions Securities Inc. and Natixis Securities North America Inc. were the joint bookrunners.
Proceeds will initially be escrowed pending satisfaction of certain conditions, including the closing of the contribution of certain oil and gas assets by Arkoma Drilling, LP and Williston Drilling, LP, entities owned by Jerry Jones and his family, according to a company press release.
The issuance of Comstock common stock in connection with the Jones contribution is being submitted to the Comstock stockholders for approval at its upcoming annual meeting to be held on Aug. 10.
Upon release from escrow the Frisco, Texas-based independent energy company said it will use the proceeds, together with a new senior secured revolving credit facility and cash on hand, to retire all of its existing debt as part of its refinancing plan.
| Issuer: | Comstock Resources, Inc.
|
| Amount: | $850 million
|
| Maturity: | Aug. 15, 2026
|
| Securities: | Senior notes
|
| Left bookrunner: | BofA Merrill Lynch
|
| Joint bookrunners: | BMO Capital Markets Corp., Fifth Third Securities Inc., Capital One Securities Inc., Regions Securities Inc., Natixis Securities North America Inc.
|
| Co-managers: | KeyBanc Capital Markets LLC, Huntington, Hancock Whitney, Citigroup Global Markets Inc., CIBC World Markets Corp., Comerica
|
| Coupon: | 9¾%
|
| Price: | 95.988
|
| Yield: | 10½%
|
| Spread: | 762 bps
|
| Call protection: | Three years
|
| Trade date: | July 20
|
| Settlement date: | Aug. 3
|
| Ratings: | Moody's: Caa1
|
| S&P: B
|
| Fitch: B
|
| Distribution: | Rule 144A and Regulation S with registration rights
|
| Price talk: | 10½% including OID
|
| Marketing: | Roadshow
|
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