Ecopetrol S.A. Announces Postponement of Price Determination Time and Extension of Expiration Time, Guaranteed Delivery Date and Settlement Date of its Cash Tender Offer for Any and All of its Outstanding 5.375% Notes due 2026

Rhea-AI Summary

Ecopetrol S.A. (NYSE: EC) announces the postponement of the Price Determination Time and extension of the Expiration Time, Guaranteed Delivery Date, and Settlement Date for its cash tender offer to purchase any and all of its outstanding 5.375% Notes due 2026. Key updates include:

- New Price Determination Time: 10:00 a.m., New York City Time on October 16, 2024
- New Expiration Time: 5:00 p.m., New York City Time on October 16, 2024
- New Guaranteed Delivery Date: 5:00 p.m., New York City Time on October 18, 2024
- New Settlement Date: Expected to be October 21, 2024

The offer is conditioned upon the satisfaction of certain conditions, including the Financing Condition related to a concurrent offering of new notes. Holders who have previously validly tendered their Securities do not need to re-tender. The offer remains subject to the terms and conditions set forth in the Offer to Purchase dated October 8, 2024.

Positive

• Extension of key dates provides more time for bondholders to participate in the tender offer
• Concurrent offering of new notes to potentially improve Ecopetrol's debt structure

Negative

• Postponement may indicate challenges in meeting initial timeline or market conditions
• Offer remains subject to Financing Condition, which may not be met

Insights

Financial Analyst

This announcement regarding the postponement and extension of Ecopetrol's cash tender offer for its 5.375% Notes due 2026 is moderately impactful for investors. Key points to consider:

• The company is extending the tender offer timeline, potentially due to market conditions or ongoing negotiations.
• The offer is tied to a concurrent new notes offering, indicating Ecopetrol is restructuring its debt profile.
• This move could affect the company's debt maturity profile and interest expenses.

For investors, this extension may signal some challenges in executing the debt refinancing as initially planned. However, it also provides more time for noteholders to participate. The outcome of this tender offer and the new notes issuance will be important in assessing Ecopetrol's financial flexibility and future interest burden.

Market Research Analyst

This news has neutral to slightly negative implications for Ecopetrol's stock in the short term:

• The delay in the tender offer and new notes issuance might create some uncertainty among investors.
• It could indicate less favorable market conditions for the new debt issuance than initially anticipated.
• However, the company is demonstrating flexibility in its approach, which is positive.

Long-term impact will depend on the final terms of the new notes and the success of the tender offer. Investors should monitor the pricing and demand for the new notes, as well as the participation rate in the tender offer, to gauge market sentiment towards Ecopetrol's debt. These factors could influence the stock's performance in the coming weeks.

BOGOTÁ, Colombia, Oct. 16, 2024 /PRNewswire/ -- As a result of the postponement of the Notes Offering (as defined below), Ecopetrol S.A. ("Ecopetrol" or the "Company") (NYSE: EC) hereby announces that it is postponing the Price Determination Time and extending the Expiration Time, Guaranteed Delivery Date and Settlement Date of its previously announced cash tender offer (the "Offer"), to purchase any and all of its outstanding 5.375% Notes due 2026 (the "Securities"), upon the terms and subject to the conditions set forth in Ecopetrol's Offer to Purchase, dated October 8, 2024 (as the same may be amended or supplemented hereby and from time to time, the "Offer to Purchase") and in the related Notice of Guaranteed Delivery (as it may be amended or supplemented from time to time, the "Notice of Guaranteed Delivery").

Under the Offer, the original Price Determination Time was at 10:00 a.m., New York City Time on October 15, 2024 (which did not occur as originally scheduled), the original Expiration Time was at 5:00 p.m., New York City Time on October 15, 2024 (which did not occur as originally scheduled), the Guaranteed Delivery Date was at 5:00 p.m., New York City Time on October 17, 2024, and the original Settlement Date was expected to be October 18, 2024, in each case, unless extended by Ecopetrol in its sole discretion.  The new Price Determination Time is at 10:00 a.m., New York City Time on October 16, 2024, the new Expiration Time is at 5:00 p.m., New York City Time on October 16, 2024, the new Guaranteed Delivery Date is at 5:00 p.m., New York City Time on October 18, 2024, and the new Settlement Date is expected to be October 21, 2024. Consequently, all references to the Price Determination Time, the Expiration Time, the Guaranteed Delivery Date, and the Settlement Date in the Offer to Purchase shall be deemed to refer to the new Price Determination Time, the new Expiration Time, the new Guaranteed Delivery Date and the new Settlement Date, as set forth in the immediately preceding sentence. Capitalized terms used but not defined herein shall have the meanings given to such terms in the Offer to Purchase.

The table below shows the following updated key dates in connection with the Offer:

Date		Calendar Date
Launch Date		October 8, 2024
Price Determination Time		10:00 a.m., New York City time, on October 16, 2024, unless the Offer is extended or earlier terminated
Expiration Time		5:00 p.m., New York City time, on October 16, 2024, unless extended by Ecopetrol in its sole discretion
Guaranteed Delivery Date		5:00 p.m., New York City time, on October 18, 2024, unless extended by Ecopetrol in its sole discretion
Settlement Date		The expected Settlement Date is on or about October 21, 2024, unless the Expiration Time is extended by Ecopetrol in its sole discretion

Except as described in this press release, the other terms of the Offer as set forth in the Offer to Purchase remain unchanged. Holders who have previously validly tendered (and not withdrawn) their Securities will not need to re-tender their Securities to be eligible to receive the Total Consideration.

Tenders of Securities pursuant to the Offer may be validly withdrawn at or prior to the Expiration Time. If the Offer is further extended, tendered Securities may be withdrawn at any time before the 10th business day after commencement of the Offer. Securities subject to the Offer may also be validly withdrawn at any time after the 60th business day after commencement of the Offer if for any reason the Offer has not been consummated within 60 business days after commencement.

The Offer is conditioned upon the satisfaction or waiver by Ecopetrol of certain conditions described in the Offer to Purchase, including the Financing Condition (as defined below), but is not conditioned upon any minimum principal amount of Securities being tendered. Subject to applicable law, Ecopetrol may, at its sole discretion, waive any condition applicable to the Offer and may further extend the Offer. Under certain conditions and as more fully described in the Offer to Purchase, Ecopetrol may terminate the Offer before the Expiration Time.

The Offer is being made in connection with a concurrent offering of notes (the "New Notes") by the Company (the "Notes Offering").  The "Financing Condition" means that the Company shall have priced and closed the Notes Offering on terms satisfactory to the Company and resulting in net cash proceeds sufficient to fund the Total Consideration with respect to the Securities validly tendered at or prior to the Expiration Time (regardless of actual amount of Securities tendered), plus accrued and unpaid interest on such Securities from the last interest payment date to, but excluding, the Settlement Date.  The Offer is not an offer to sell or a solicitation of an offer to buy the New Notes.

The complete terms and conditions of the Offer are set forth in the Offer to Purchase and in the related Notice of Guaranteed Delivery, which holders are urged to read carefully before making any decision with respect to the Offer.

The Offer is open to all registered holders of Securities. A beneficial owner of Securities that are held of record by a broker, dealer, commercial bank, trust company, or other nominee (each, a "Custodian") must instruct such Custodian to tender such Securities on the beneficial owner's behalf in a timely manner. Beneficial owners should be aware that a Custodian may establish its own earlier deadline for participation in an Offer.

Global Bondholder Services Corporation is serving as the tender agent and information agent. Requests for documents may be directed to Global Bondholder Services Corporation by telephone at +1 212-430-3774  (banks and brokers) or Toll-Free at +1 855-654-2014.

Copies of the Offer to Purchase and related Notice of Guaranteed Delivery are available at the following web address: at https://gbsc-usa.com/ecopetrol/.

BBVA Securities Inc., J.P. Morgan Securities LLC and Santander US Capital Markets LLC are serving as Dealer Managers (the "Dealer Managers") for the Offer. Questions regarding the Offer may also be directed to the Dealer Managers as set forth below:

BBVA Securities Inc. 1345 Avenue of the Americas, 44th Floor New York, New York 10105 United States of America Attn: Liability Management Collect: +1 (212) 728-2446 U.S. Toll Free: +1 (800) 422-8692 Email: liabilitymanagement@bbva.com

J.P. Morgan Securities LLC 383 Madison Avenue New York, New York 10179 United States of America Attention: Latin America Debt Capital Markets Collect: (212) 834-7279 U.S. Toll Free: (866) 846-2874

Santander US Capital Markets LLC 437 Madison Avenue New York, New York 10022 United States of America Attn: Liability Management Group Collect: (212) 940-1442 U.S. Toll-Free: (855) 404-3636 Email: AmericasLM@santander.us

This press release is for informational purposes only and does not constitute an offer to purchase nor the solicitation of an offer to sell any Securities. The Offer is being made only pursuant to the Offer to Purchase and related Notice of Guaranteed Delivery. 

No Recommendation                                           

None of Ecopetrol, BBVA Securities Inc., J.P. Morgan Securities LLC, Santander US Capital Markets LLC, Global Bondholder Services Corporation, or the trustee or security registrar with respect to the Securities, nor any affiliate of any of the foregoing, has made any recommendation as to whether holders should tender or refrain from tendering all or any portion of their Securities in response to the Offer or expressing any opinion as to whether the terms of the Offer are fair to any holder. Holders must make their own decision as to whether to tender any of their Securities and, if so, the purchase price of Securities to tender. Please refer to the Offer to Purchase for a description of the offer terms, conditions, disclaimers and other information applicable to the Offer.

About Ecopetrol

Ecopetrol is a mixed-economy company, the largest company in Colombia and one of the main integrated energy companies in the American continent, with more than 19,000 employees. In Colombia, it is responsible for more than 60% of the hydrocarbon production of most transportation, logistics, and hydrocarbon refining systems, and it holds leading positions in the petrochemicals and gas distribution segments. With the acquisition of 51.4% of ISA's shares, the company participates in energy transmission, the management of real-time systems (XM), and the Barranquilla - Cartagena coastal highway concession. At the international level, Ecopetrol has a stake in strategic basins in the American continent, with Drilling and Exploration operations in the United States (Permian basin and the Gulf of Mexico), Brazil, and Mexico, and, through ISA and its subsidiaries, Ecopetrol holds leading positions in the power transmission business in Brazil, Chile, Peru, and Bolivia, toll road concessions in Chile, and the telecommunications sector.  

Disclaimer and Other Important Notices

The Company expressly reserves the absolute right, in its sole discretion, from time to time to purchase any Securities that remain outstanding after the Expiration Date through open-market or privately negotiated transactions, one or more additional tender or exchange offers or otherwise, on terms and at prices that may or may not be equal to the consideration offered in the Offer, or to exercise any of its rights, including redemption rights, under the Indenture governing the Securities.

This press release and the Offer to Purchase do not constitute an offer to purchase or the solicitation of an offer to sell Securities in any jurisdiction in which such offer or solicitation would be unlawful. In those jurisdictions where the securities, blue sky or other laws require the Offer to be made by a licensed broker or dealer, the Offer shall be deemed to be made on behalf of Ecopetrol by the Dealer Managers or one or more registered brokers or dealers licensed under the laws of such jurisdiction. If materials relating to the Offer come into a holder's possession, the holder is required by Ecopetrol to inform itself of and to observe all of these restrictions.

The Offer to Purchase has not been filed with or reviewed by the SEC, any state securities commission or any other regulatory authority, nor has any such commission or other regulatory authority passed upon the accuracy or adequacy of the Offer to Purchase or any of the accompanying ancillary documents delivered thereunder. Any representation to the contrary is unlawful and may be a criminal offense.

The Offer to Purchase will not be authorized by the Colombian Superintendency of Finance (Superintendencia Financiera de Colombia or the "SFC" by its acronym in Spanish) and will not be registered under the Colombian National Registry of Securities and Issuers (Registro Nacional de Valores y Emisores) or the Colombian Stock Exchange (Bolsa de Valores de Colombia or the "BVC" by its acronym in Spanish), and, accordingly, the Offer to Purchase may not constitute an offer to persons in Colombia except in circumstances which do not result in a public offering under Colombian law and must be carried out in compliance with Part 4 of Decree 2555 of 2010.

This press release may contain forward-looking statements within the meaning of Section 27A of the United States Securities Act of 1933, as amended, and Section 21E of the United States Securities Exchange Act of 1934, as amended, including those related to the Offer. Forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future, and, accordingly, such results may differ from those expressed in any forward-looking statements. Ecopetrol is not under any obligation to (and expressly disclaims any such obligation to) update forward- looking statements as a result of new information, future events or otherwise, except as required by law.

Investor Relations

Lina María Contreras Mora
Acting Head of Capital Markets
Carrera 13 No. 36-24, Bogotá, Colombia
e-mail: investors@ecopetrol.com.co

 

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SOURCE Ecopetrol S.A.

FAQ

What are the new key dates for Ecopetrol's (EC) tender offer for its 5.375% Notes due 2026?

The new Price Determination Time is 10:00 a.m., New York City Time on October 16, 2024. The new Expiration Time is 5:00 p.m., New York City Time on October 16, 2024. The new Guaranteed Delivery Date is 5:00 p.m., New York City Time on October 18, 2024. The new Settlement Date is expected to be October 21, 2024.

Do bondholders who have already tendered their Ecopetrol (EC) Securities need to re-tender?

No, holders who have previously validly tendered (and not withdrawn) their Securities do not need to re-tender to be eligible to receive the Total Consideration.

What is the Financing Condition for Ecopetrol's (EC) tender offer?

The Financing Condition requires Ecopetrol to have priced and closed a concurrent offering of new notes on terms satisfactory to the company, with net cash proceeds sufficient to fund the Total Consideration for the Securities validly tendered, plus accrued and unpaid interest.

When can Securities be withdrawn from Ecopetrol's (EC) tender offer?

Securities can be validly withdrawn at or prior to the Expiration Time (5:00 p.m., New York City Time on October 16, 2024). If the offer is further extended, they can be withdrawn before the 10th business day after commencement or after the 60th business day if the offer hasn't been consummated.