QEP Resources Inc. (NYSE: QEP) said on Nov. 6 it has priced an offering of $500 million aggregate principal amount of senior notes due 2026. The notes will bear interest at a rate of 5.625% per annum and will be issued at par.
Simultaneously, the company issued a redemption notice for its senior notes due 2018 as well as a buyback of its senior notes due 2020 and 2021.
QEP intends to use about $134 million of the net proceeds from the offering to redeem its outstanding 6.80% senior notes due 2018. QEP also plans to use the remainder of the net proceeds to fund the buyback of up to $361 million aggregate principal amount of its outstanding 6.80% senior notes due 2020 and 6.875% senior notes due 2021.
If the aggregate principal amount of the target notes accepted for payment in the tender offers and the 6.80% senior notes due 2018 redeemed in connection with the redemption is less than the net proceeds of this offering, QEP expects to use the remainder of the net proceeds for general corporate purposes, including the repayment or redemption of outstanding indebtedness.
QEP expects to close the sale of the notes on November 21, 2017, subject to customary closing conditions.
Wells Fargo Securities LLC, BMO Capital Markets Corp. (NASD: BMLP), Citigroup Global Markets Inc., Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, MUFG Securities Americas Inc. and US Bancorp Investments Inc. are acting as joint book-running managers of the offering.