Permian Resources Corporation Announces Pricing Terms of Tender Offer for Its 7.75% Senior Notes due 2026

Rhea-AI Summary

Permian Resources (NYSE: PR) has announced the pricing terms for its cash tender offer to purchase any and all of its outstanding 7.75% Senior Notes due 2026. The purchase price is set at $1,014.67 per $1,000 principal amount of Notes validly tendered and accepted. The tender offer will expire on August 2, 2024, at 5:00 p.m. New York City time, unless extended or terminated earlier.

The tender offer is conditioned upon the completion of a contemporaneous notes offering by Permian Resources Operating, Settlement for all tendered Notes is expected on August 8, 2024. The company intends to redeem any remaining Notes not purchased in the tender offer on or about February 15, 2025, at 100.000% of the principal amount plus accrued interest.

Positive

• Offering to purchase all outstanding 7.75% Senior Notes due 2026, potentially improving debt structure
• Purchase price of $1,014.67 per $1,000 principal amount, providing a premium to noteholders
• Contemporaneous notes offering to fund the tender offer, indicating access to capital markets

Negative

• Potential increase in debt if new notes offering exceeds the amount of notes purchased in the tender offer
• Additional interest expense if new notes have a higher interest rate than the 7.75% Senior Notes being repurchased

Insights

Financial Analyst

This tender offer for Permian Resources' 7.75% Senior Notes due 2026 is a strategic financial move that could have positive implications for the company's balance sheet. The offer price of $1,014.67 per $1,000 principal amount represents a premium to par value, which may incentivize noteholders to participate.

The company's plan to fund this tender offer with proceeds from a new notes offering suggests a debt refinancing strategy. If successful, this could lead to lower interest expenses and improved cash flow, depending on the terms of the new notes. The intention to redeem any remaining notes in February 2025 at par value further demonstrates Permian's proactive approach to debt management.

Investors should monitor the success rate of this tender offer and the terms of the new notes offering to gauge the overall impact on Permian Resources' financial position and future profitability.

Oil & Gas Industry Expert

As the second-largest pure-play E&P in the Delaware Basin, Permian Resources' financial maneuvers are significant for the broader oil and gas sector. This tender offer, coupled with a new notes issuance, suggests the company is taking advantage of current market conditions to optimize its capital structure.

The move could potentially free up capital for core operations in the Delaware Basin, a region known for its high-return oil and gas properties. This financial flexibility might allow Permian Resources to accelerate its development plans or pursue strategic acquisitions in a competitive market.

Investors should consider how this refinancing strategy compares to peers in the Permian Basin and whether it positions the company for stronger operational performance in the current oil price environment.

MIDLAND, Texas--(BUSINESS WIRE)-- Permian Resources Corporation (“Permian Resources,” “we,” “us” or “our”) (NYSE: PR) today announced the pricing terms of the previously announced cash tender offer to purchase (the “Tender Offer”) any and all of the outstanding senior notes (the “Notes”) listed in the following table upon the terms and conditions described in the Offer to Purchase, dated July 29, 2024 (the “Offer to Purchase”), of Permian Resources Operating, LLC, a subsidiary of Permian Resources (“OpCo”).

Certain information regarding the Notes and the U.S. Treasury Reference Security, the Bloomberg reference page and the fixed spread is set forth in the table below.

Title of Security

CUSIP Numbers

Principal Amount Outstanding

U.S. Treasury Reference Security

Bloomberg Reference Page

Reference Yield

Fixed Spread (basis points)

Purchase Price

7.75% Senior Notes due 2026

19416MAA7 (144A) / U19447AA6 (Reg S)

$300,000,000

2.000% U.S. Treasury due, February 15, 2025

FIT3

4.853%

0

$1,014.67

The “Purchase Price” for each $1,000 principal amount of the Notes validly tendered, and not validly withdrawn, and accepted for purchase pursuant to the Tender Offer will be determined in the manner described in the Offer to Purchase by reference to the fixed spread specified above plus the yield based on the bid-side price of the U.S. Treasury Reference Security specified above, as quoted on the Bloomberg Bond Trader FIT3 series of pages, at 2:00 p.m. New York City time, on August 2, 2024, the date on which the Tender Offer is currently scheduled to expire. The Purchase Price will be based on a yield to February 15, 2025, the date of the next specified redemption price reduction under the indenture governing the Notes, and assuming the Notes are redeemed on February 15, 2025, at the specified redemption price for such date of 100.000% of the principal amount, as described in the Offer to Purchase.

In addition to the Purchase Price, holders whose Notes are purchased pursuant to the Tender Offer will also receive accrued and unpaid interest thereon from the last interest payment date up to, but not including, the initial date on which OpCo makes payment for such Notes, which date is currently expected to be August 8, 2024, assuming that the Tender Offer is not extended or earlier terminated.

The Tender Offer is being made pursuant to the terms and conditions contained in the Offer to Purchase and Notice of Guaranteed Delivery, copies of which may be obtained from D.F. King & Co., Inc., the tender agent and information agent for the Tender Offer, by calling (800) 676-7437 (toll-free) or, for banks and brokers, (212) 269-5550. Copies of the Offer to Purchase and Notice of Guaranteed Delivery are also available at the following web address: https://www.dfking.com/permian; or by requesting via email at permian@dfking.com.

The Tender Offer will expire at 5:00 p.m., New York City time, on August 2, 2024 unless extended or earlier terminated (such time and date, as the same may be extended, the “Expiration Time”). Tendered Notes may be withdrawn at any time before the Expiration Time. Holders of Notes must validly tender and not validly withdraw their Notes (or comply with the procedures for guaranteed delivery) before the Expiration Time to be eligible to receive the Purchase Price for their Notes.

Settlement for all Notes tendered prior to the Expiration Time or pursuant to a Notice of Guaranteed Delivery is expected to be August 8, 2024, assuming that the Tender Offer is not extended or earlier terminated.

There can be no assurance that any Notes will be purchased. The Tender Offer is conditioned upon the satisfaction of certain conditions, including the completion of a contemporaneous notes offering (the “Notes Offering”) by OpCo on terms and conditions (including, but not limited to, the amount of proceeds raised in such Notes Offering) satisfactory to OpCo and Permian Resources. The Tender Offer is not conditioned upon any minimum amount of Notes being tendered. The Tender Offer may be amended, extended, terminated or withdrawn. OpCo intends to use a portion of the net proceeds of the Notes Offering to fund the purchase of the Notes in the Tender Offer.

Subject to completion of the Tender Offer, we intend to redeem all Notes not purchased in the Tender Offer on or about February 15, 2025 (the “Redemption”) at a redemption price of 100.000% of the principal amount, plus accrued and unpaid interest, if any, to the redemption date.

OpCo has retained J.P. Morgan Securities LLC to serve as the exclusive Dealer Manager for the Tender Offer. Questions regarding the terms of the Tender Offer may be directed to J.P. Morgan Securities LLC, Liability Management Group, at (866) 834-4666 (toll-free) or (212) 834-4818 (collect).

This press release is neither an offer to purchase nor a solicitation of an offer to sell any Notes in the Tender Offer and does not constitute a notice of redemption for the Notes. In addition, this press release is not an offer to sell or the solicitation of an offer to buy any securities issued in connection with any contemporaneous Notes Offering, nor shall there be any sale of the securities issued in such Notes Offering in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

About Permian Resources

Headquartered in Midland, Texas, Permian Resources is an independent oil and natural gas company focused on the responsible acquisition, optimization and development of high-return oil and natural gas properties. Permian Resources’ assets and operations are concentrated in the core of the Delaware Basin, making it the second largest Permian Basin pure-play E&P.

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 Securities 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, including the Tender Offer and the timing and outcome thereof and the Redemption, 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.

We caution you that any forward-looking statements are subject to all of the risks and uncertainties, most of which are difficult to predict and many of which are beyond our control, incident to the development, production, gathering and sale of oil and natural gas. Factors which could cause our actual results to differ materially from the results contemplated by forward-looking statements may include, but are not limited to, those set forth in Permian Resources’ filings with the U.S. Securities and Exchange Commission (the “SEC”), including its Annual Report on Form 10-K for the fiscal year ended December 31, 2023, and its subsequent Quarterly Reports on Form 10-Q, under the caption “Risk Factors,” as may be updated from time to time in Permian Resources’ 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. All forward-looking statements, expressed or implied, included in this press release are expressly qualified in their entirety by this cautionary statement. 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.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240802959510/en/

Hays Mabry – Vice President, Investor Relations

(432) 315-0114

ir@permianres.com

Source: Permian Resources Corporation

FAQ

What is the purchase price for Permian Resources' 7.75% Senior Notes due 2026 in the tender offer?

The purchase price is $1,014.67 per $1,000 principal amount of Notes validly tendered and accepted in the tender offer.

When does Permian Resources' (PR) tender offer for its 7.75% Senior Notes due 2026 expire?

The tender offer is scheduled to expire on August 2, 2024, at 5:00 p.m. New York City time, unless extended or terminated earlier.

What is the expected settlement date for Permian Resources' (PR) tender offer?

The expected settlement date for the tender offer is August 8, 2024, assuming the offer is not extended or terminated earlier.

What does Permian Resources (PR) plan to do with any remaining 7.75% Senior Notes not purchased in the tender offer?

Permian Resources intends to redeem any remaining Notes not purchased in the tender offer on or about February 15, 2025, at 100.000% of the principal amount plus accrued interest.