New Issue: Plains Exploration & Production prices $300 million 10-year notes at par to yield 7 5/8%

By Paul Deckelman

New York, March 24 -- Plains Exploration & Production Co. priced $300 million of 10-year senior notes (B1/BB-) at par on Wednesday to yield 7 5/8%, high yield syndicate sources said. The deal came at the tight end of price talk envisioning a yield between 7 5/8% and 7¾%.

The drive-by offering was announced in the morning and had priced that same afternoon.

The bonds were sold via an underwritten public offering.

J.P. Morgan Securities Inc., Barclays Capital Inc., BMO Capital Markets Corp., Banc of America Merrill Lynch, Citigroup Global Markets, Inc. and Wells Fargo Securities, LLC were the bookrunners on the deal, with BNP Paribas, RBS Securities Inc., Scotia Capital (USA) Inc. and TD Securities, Inc. as the co-managers.

The bonds have five years of call protection, as well as the standard provisions allowing a change-of-control put at 101 and a three-year equity clawback.

Plains, a Houston-based independent oil and gas exploration and production company, plans to use the proceeds to repay indebtedness under its senior revolving credit facility and for general corporate purposes.

Issuer:	Plains Exploration & Production Co.
Issue:	Senior notes
Amount:	$300 million
Proceeds:	$300 million
Maturity:	April 1, 2020
Bookrunners:	J.P. Morgan Securities Inc., Barclays Capital Inc., BMO Capital Markets Corp., Banc of America Merrill Lynch, Citigroup Global Markets, Inc. and Wells Fargo Securities, LLC
Co-managers:	BNP Paribas, RBS Securities Inc., Scotia Capital (USA) Inc. and TD Securities, Inc.
Coupon:	7 5/8%
Price:	par
Yield:	7 5/8%
Spread:	379 basis points
Call features:	Make-whole call at T+50 bps until April 1, 2015, then callable at 103.813, callable on or after April 1, 2016 at 102.542, callable on or after April 1, 2017 at 101.271 and finally callable at par on or after April 1, 2018.
Equity clawback:	For up to 35% of issue at 107.625% until April 1, 2013
Change of control:	Put at 101% of principal plus accrued interest
Trade date:	March 24
Settlement date:	March 29
Ratings:	Moody's: B1
	Standard & Poor's: BB-
Distribution:	SEC registered public offering
Price talk:	7 5/8% to 7¾%
Marketing:	Quick to market

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