Summary
Chesapeake Energy Corporation (the "Company") announced on December 12, 2016, a private placement of $1.0 billion in aggregate principal amount of 8.00% Senior Notes due 2025. These notes are being sold through Deutsche Bank Securities Inc. and are expected to close on December 20, 2016, with net proceeds of approximately $973.5 million after discounts and expenses. The primary use of these proceeds is to fund the Company's ongoing tender offers for various existing senior notes. If the tender offers are fully consummated and fully funded, any remaining proceeds will be allocated towards general corporate purposes, which may include further debt repurchases or repayment of other senior notes with near-term maturities. This transaction signals the Company's proactive approach to managing its debt profile and potentially restructuring its existing liabilities.
Key Highlights
- 1Chesapeake Energy Corp. is issuing $1.0 billion in 8.00% Senior Notes due 2025 via a private placement.
- 2Net proceeds are estimated to be approximately $973.5 million.
- 3The primary use of funds is to finance tender offers for existing senior notes.
- 4If tender offers are oversubscribed or not fully consummated, remaining proceeds will be used for general corporate purposes, including debt reduction.
- 5The transaction is expected to close on December 20, 2016.
- 6The notes are being offered pursuant to Rule 144A and Regulation S under the Securities Act.
- 7Deutsche Bank Securities Inc. is acting as the representative for the initial purchasers.