RKI Exploration talks $350 million eight-year notes to yield 8½%

By Paul A. Harris

Portland, Ore., July 12 - RKI Exploration & Production, LLC and RKI Finance Corp. talked their $350 million offering of eight-year senior notes (B3/B-) to yield 8½%, an informed source said on Friday.

That yield talk is in line with initial guidance, the source added.

The deal is set to price on Monday.

Citigroup Global Markets Inc., J.P. Morgan Securities LLC and UBS Investment Bank are the joint bookrunners. BBVA Securities and Mitsubishi UFJ Securities are the senior co-managers. BOSC Inc., Comerica Securities, Natixis Securities and US Bancorp are the co-managers.

The Rule 144A and Regulation S for life notes become callable in three years at par plus 75% of the coupon. The notes feature a three-year 35% equity clawback and a 101% poison put.

The Oklahoma City-based energy company plans to use the proceeds to fully repay its second-lien credit facility and pay down its revolver.

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