$100m (+15m) sen unsec cb coming tonight from CITI. Terms: 5yr, 5.25-5.75% up 20-25%, full pctns. UOP = Acq of Marcellus Shale assets & gcp. %540m indy E&P co. HY mkt turned away recent $250m deal which woould have taken out 11.5/12% str8s. Capex high on 3 UK/US projects as it strives for 10k boe per day (currently 3k). LTM fcf -98m, ebitda = 36m, PF cash = 687m, debt = 374m. Unlike HY route, > CB there will be 2 o/standing str8s plus expanding t/loan (75m). We’ll assume CCC & L+900. See credit color. Vol less material to your decision process but those modelling, assume 30% (ADV = 290k w/little gamma on way down). Brw = 75bps. Theo = 106.375 on rich (say no more) small deal, not great timing & w/be illiquid but if you like story, it is cheap.
END is an independent oil & natural gas e&p with operations in North Sea region of UK and the US.
Small e&p with 1Q11 avg daily vol 3k boe & proved reserves 3.5m Most assets not operational. Spending heavily to dev 3 UK proj & expand US precense, 1st to begin prod late 2011. Co goal increase daily prod to 10k, but target has been elusive. 2011 cap-ex plan $150k, will lead to more cash burn. $250m HY deal to take out high rate 13/14 maturities, but did not fly. Buying more US assets, expanding term loan $75m to fund development
L+900