-- Parex Resources (PXT.TO) will issue US$500 million aggregate principal amount of senior unsecured notes due 2031 in a private placement offering, it said Thursday.
The notes were priced at par and will bear interest at a rate of 8.50% per annum and mature on May 11, 2031. Closing of the offering is expected to on May 11, it added.
Proceeds, after payment of the initial purchasers' fees and estimated offering expenses, will be deposited into an escrow account pending satisfaction of certain escrow release conditions, including the consummation of the previously announced acquisition of Frontera Energy Corporation's exploration and production assets in Colombia, it said. Net proceeds, upon satisfaction of the escrow release conditions, will be released.
Parex will use the proceeds to fund the cash portion of the consideration for the Frontera deal, and to pay fees and expenses in connection with the Frontera deal and the offering. Proceeds not used for such purposes will be used for general corporate needs.
Shares in Parex were down more than 4% yesterday.