By Paul A. Harris
Portland, Ore., Jan. 22 – Colgate Energy Partners III, LLC priced a restructured $300 million issue of 7¾% five-year notes (B3/B) at 98.97 to yield 8% on Friday, according to market sources.
The deal engendered pushback from investors, sources said.
The tenor of the notes was decreased to five years from seven years. The coupon and yield came on top of revised talk. Earlier talk had the notes coming to yield in the 7¾% area. Initial guidance was in the mid-to-high 7% area.
The notes were higher approaching Friday's close, with a trader marking them at 99½ bid, par ½ offered.
Credit Suisse Securities (USA) LLC was the left lead bookrunner. Joint bookrunners were Wells Fargo Securities LLC, Jefferies LLC, RBC Capital Markets Corp. and Truist Securities Inc.
The Midland, Tex., privately held independent oil and gas company plans to use the proceeds to repay debt under its revolving credit facility and to fund a distribution to its members.
| Issuer: | Colgate Energy Partners III, LLC
|
| Amount: | $300 million
|
| Maturity: | Feb. 15, 2026
|
| Securities: | Notes
|
| Lead left bookrunner: | Credit Suisse Securities (USA) LLC
|
| Joint bookrunners: | Wells Fargo Securities LLC, Jefferies LLC, RBC Capital Markets Corp. and Truist Securities Inc.
|
| Co-managers: | BBVA Securities Inc., Comerica Securities Inc. and Woodrock
|
| Coupon: | 7¾%
|
| Price: | 98.97
|
| Yield: | 8%
|
| Spread: | 755 bps
|
| First call: | Feb. 15, 2024 at 103.875
|
| Equity clawback: | 35% at 107.75 until Feb. 15, 2024
|
| Trade date: | Jan. 22
|
| Settlement date: | Jan. 27
|
| Ratings: | Moody's: B3
|
| S&P: B
|
| Distribution: | Rule 144A and Regulation S
|
| Price talk: | 7¾% coupon to yield 8%, revised from 7¾% area
|
| Marketing: | Roadshow
|
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