DNO repurchases NOK 455.5 million of floaters due 2009, 7.915% bonds

By Angela McDaniels

Seattle, Feb. 24 - DNO ASA repurchased NOK 285 million of its floating-rate notes due 2009, series DNO 03 and NOK 170.5 million of its 7.915% bonds due 2009, series DNO 04 according to a company news release.

The repurchase offer was made in connection with debt refinancing and ended on Feb. 17.

The company paid 106.15 for the floating-rate bonds, which have a coupon of Nibor plus 350 basis points, and 108.56 for the 7.915% bonds using the Norwegian swap curve.

Bondholders approved an amendment to the equity ratio coverage test, setting it to a level of net interest bearing debt to book equity coverage of less than 3 times, and deleting the restriction on additional funding through secured loans in the loan agreements for the two series of notes. With the consents, DNO was able to proceed with the offer.

The Oslo, Norway, oil and gas exploration and production company said it will refinance the bonds with new bond issues maturing in 2011 and 2012.

In an earlier news release, DNO said its existing bondholders may subscribe to the following bonds based on approval of amendments to the floaters and 7.915% bonds: new five-year floating-rate bonds with a coupon of three-month Nibor plus 250 bps, existing floating-rate callable bonds due 2012, series DNO 06 with a coupon of three-month Nibor plus 335 bps and existing 3.35% notes due 2012.

Fearnley Fonds ASA managed the buyback and will sell the new five-year floaters.

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