Chord Energy Corporation Announces $750 Million Offering of Senior Notes

Rhea-AI Summary

Chord Energy (NASDAQ: CHRD) has announced plans to offer $750 million in senior unsecured notes due 2033 through a private placement to eligible purchasers. The new notes will be guaranteed by the company's existing and future domestic subsidiaries that guarantee its senior secured revolving credit facility.

The proceeds will be used to:

• Finance a cash tender offer for all outstanding 6.375% senior notes due 2026
• Redeem any remaining 2026 notes at 100% of principal amount plus interest
• Repay a portion of borrowings under the company's Credit Facility
• Cover associated fees and expenses

The notes offering is subject to market conditions, and final terms may vary. While the Notes Offering is not contingent on the Tender Offer, the Tender Offer depends on the Notes Offering's completion.

Positive

• Debt refinancing could reduce interest expenses
• Extended debt maturity to 2033
• Strategic debt management through tender offer

Negative

• Substantial debt level at $750 million
• Notes are unsecured obligations
• Final terms subject to market conditions may be less favorable

Insights

Financial Analyst

Chord Energy's announcement of a $750 million senior notes offering represents a significant balance sheet restructuring initiative that will materially impact the company's debt profile. This refinancing transaction has three key components worth noting:

First, the maturity extension from 2026 to 2033 provides Chord with an additional seven years of financial runway, reducing near-term refinancing risk and potentially enhancing strategic flexibility during a period of energy market volatility.

Second, while the interest rate on the new notes remains undisclosed, the refinancing of the 6.375% 2026 notes could potentially result in interest expense savings if executed under favorable market conditions. For context, this $750 million offering represents approximately 11% of Chord's current market capitalization.

Third, the partial repayment of the revolving credit facility indicates a liability management strategy that may optimize Chord's debt structure rather than increase overall leverage. This suggests a financially disciplined approach focused on balance sheet efficiency rather than expansion.

The transaction's impact on Chord's overall weighted average cost of capital and interest coverage ratios will depend heavily on the final pricing of the new notes relative to the retiring 6.375% debt. Energy companies typically prioritize financial flexibility given the sector's capital-intensive nature and exposure to commodity price fluctuations.

HOUSTON, Texas, March 3, 2025 /PRNewswire/ -- Chord Energy Corporation (NASDAQ: CHRD) (the "Company," "we," "us," or "our"), announced today that, subject to market conditions, it intends to offer $750 million in aggregate principal amount of senior unsecured notes due 2033 (the "New Notes") in a private placement to eligible purchasers (the "Notes Offering"). The New Notes will be unsecured, senior obligations of the Company and will be guaranteed by the Company's existing subsidiaries and future domestic subsidiaries that, in each case, guarantee the Company's senior secured revolving credit facility (the "Credit Facility").

The Company intends to use the net proceeds from the Notes Offering for purposes of (i) financing its concurrent cash tender offer (the "Tender Offer") for any and all of its outstanding 6.375% senior unsecured notes due 2026 (the "2026 Notes") that are validly tendered and accepted for purchase in the Tender Offer, (ii) redeem any 2026 Notes, to the extent any 2026 Notes remain outstanding following the Tender Offer, on or about June 1, 2025 at a redemption price of 100.000% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date, (iii) repay a portion of its borrowings outstanding under the Company's Credit Facility, and (iv) pay all fees and expenses associated therewith. The final terms and amounts of the New Notes are subject to market and other conditions and may be materially different than expectations. The Notes Offering is not conditioned on the Tender Offer, but the Tender Offer is conditioned on the Notes Offering.

The New Notes have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities laws and unless so registered, the notes may not be offered or sold in the United States absent an applicable exemption from, or a transaction not subject to, registration requirements of the Securities Act and applicable state securities laws. The New Notes are being offered and sold only to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act and to non-U.S. persons outside the United States pursuant to Regulation S under the Securities Act.

This press release is being issued pursuant to Rule 135c under the Securities Act and is for informational purposes only. This press release does not constitute (i) a notice of redemption or satisfaction and discharge under the indenture governing the 2026 Notes or (ii) an offer to sell or the solicitation of an offer to buy any security, including with respect to the 2026 Notes and the New Notes, and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offering, solicitation or sale would be unlawful.

About Chord Energy

Chord Energy Corporation is an independent exploration and production company with quality and sustainable long-lived assets in the Williston Basin. The Company is uniquely positioned with a best-in-class balance sheet and is focused on rigorous capital discipline and generating free cash flow by operating efficiently, safely and responsibly to develop its unconventional onshore oil-rich resources in the continental United States.

Cautionary Note Regarding Forward-Looking Statements

The information in this press release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended. All statements, other than statements of historical fact included in this press release, including statements regarding the Notes Offering and the use of proceeds therefrom, the Tender Offer and the timing and outcome thereof including satisfaction of the conditions to the closing of the Tender Offer, any redemption of our 2026 Notes, and our strategy, plans, and objectives of management, are forward-looking statements. When used in this press release, the words "could," "may," "believe," "anticipate," "intend," "estimate," "expect," "project," "goal," "plan," "target" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on management's current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events.

All forward-looking statements are subject to a number of important factors, risks, uncertainties and assumptions that could cause actual results to differ materially from those described in any forward-looking statements. These factors and risks include, but are not limited to, unanticipated developments that prevent, delay, or negatively impact the Notes Offering or the Tender Offer, and other financial, operational, and legal risks and uncertainties detailed from time to time in the Company's cautionary statements contained in its filings with the U.S. Securities and Exchange Commission (the "SEC"), including the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2024, under the caption "Risk Factors," as may be updated from time to time in the Company's periodic filings with the SEC.

Should one or more of the risks or uncertainties described in this press release occur, or should any underlying assumptions prove incorrect, our actual results and plans could differ materially from those expressed in any forward-looking statements. These forward-looking statements represent the Company's judgment as of the date of this press release. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that we or persons acting on our behalf may issue. Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this press release. All forward-looking statements, expressed or implied, included in this press release are expressly qualified in their entirety by this cautionary statement.

Contact:

Chord Energy Corporation
Bob Bakanauskas, Vice President, Investor Relations
(281) 404-9600
ir@chordenergy.com

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SOURCE Chord Energy

FAQ

What is the size and purpose of Chord Energy's (CHRD) new notes offering in March 2025?

Chord Energy is offering $750 million in senior unsecured notes due 2033 to refinance existing debt, including tender offer for 2026 notes and credit facility repayment.

When will Chord Energy (CHRD) redeem the remaining 2026 notes?

CHRD plans to redeem any remaining 2026 notes on or about June 1, 2025 at 100% of principal amount plus accrued interest.

Who can purchase Chord Energy's (CHRD) new 2033 notes?

The notes are only available to qualified institutional buyers under Rule 144A and non-U.S. persons outside the United States under Regulation S.

How are Chord Energy's (CHRD) new 2033 notes secured?

The notes will be unsecured, senior obligations guaranteed by CHRD's existing subsidiaries and future domestic subsidiaries that guarantee the credit facility.