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Callon Petroleum secures transactions to strengthen balance sheet from SNL Energy Finance Daily Callon Petroleum secures transactions to strengthen balance sheetByline: Dan Carino Jr. Callon Petroleum Co. announced a number of transactions to strengthen its balance sheet and enhance near-term liquidity in an Oct. 1 news release. The independent oil and gas producer entered into an overriding royalty interest deal with a private investment vehicle managed by Kimmeridge Energy Management Co. LLC that generated gross cash proceeds of $140 million. Callon also issued $300 million of its second lien secured notes to Kimmeridge. Proceeds from the Kimmeridge transactions will be used to reduce debt on the company's credit facility. In a separate deal, Callon entered into an agreement to sell all of its non-operated assets for $30 million in cash proceeds. The deal is expected to close in early November. The combined deals are expected to generate cash proceeds of about $465 million and result in estimated pro forma liquidity of $600 million after transaction expenses, according to Callon. Callon has completed the fall borrowing base redetermination for its senior secured credit facility, resulting in a reaffirmation of its borrowing base at $1.7 billion. The borrowing base and elected commitment were then reduced to $1.6 billion in consideration of the overriding royalty interest sale and total second lien notes capacity. Jefferies LLC acted as financial adviser to Callon for the overriding royalty interest transaction and issuance of the second lien notes. RBC Capital Markets served as lead financial adviser for the royalty interest transaction. Barclays acted as exclusive financial adviser to Kimmeridge. |
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