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Suncor Announces Tender Offers for Certain Outstanding Series of Notes

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Suncor Energy (TSX: SU) (NYSE: SU) has announced tender offers to purchase for cash certain outstanding series of notes for an aggregate purchase price of up to C$800 million, excluding accrued interest. The tender offers are divided into two pools:

Pool 1 (max C$700 million): 6.50% Notes due 2038 and 6.80% Notes due 2038

Pool 2 (max C$100 million): Various series of notes due between 2026 and 2042

The tender offers will expire on October 18, 2024. Holders tendering before the Early Tender Date of October 2, 2024, will be eligible for the Total Consideration, which includes an Early Tender Payment. The purchase price will be determined based on a fixed spread plus the yield of the applicable reference security on October 3, 2024. Suncor intends to fund the purchases with cash on hand.

Suncor Energy (TSX: SU) (NYSE: SU) ha annunciato offerte di acquisto per contanti di alcune serie di notes in circolazione per un prezzo di acquisto totale fino a 800 milioni di dollari canadesi, escludendo gli interessi maturati. Le offerte sono suddivise in due gruppi:

Gruppo 1 (massimo 700 milioni di dollari canadesi): Notes al 6.50% con scadenza nel 2038 e Notes al 6.80% con scadenza nel 2038

Gruppo 2 (massimo 100 milioni di dollari canadesi): Varie serie di notes in scadenza tra il 2026 e il 2042

Le offerte scadranno il 18 ottobre 2024. I possessori che parteciperanno prima della Data di Offerta Anticipata del 2 ottobre 2024, saranno idonei a ricevere la Considerazione Totale, che include un Pagamento per Offerta Anticipata. Il prezzo di acquisto sarà determinato in base a uno spread fisso più il rendimento del titolo di riferimento applicabile il 3 ottobre 2024. Suncor intende finanziare gli acquisti con liquidità disponibile.

Suncor Energy (TSX: SU) (NYSE: SU) ha anunciado ofertas de compra en efectivo para adquirir ciertas series de notas en circulación por un precio total de hasta 800 millones de dólares canadienses, excluyendo los intereses acumulados. Las ofertas se dividen en dos grupos:

Grupo 1 (máximo 700 millones de dólares canadienses): Notas al 6.50% con vencimiento en 2038 y Notas al 6.80% con vencimiento en 2038

Grupo 2 (máximo 100 millones de dólares canadienses): Varias series de notas con vencimiento entre 2026 y 2042

Las ofertas vencerán el 18 de octubre de 2024. Los tenedores que realicen la oferta antes de la Fecha de Oferta Anticipada del 2 de octubre de 2024, serán elegibles para la Consideración Total, que incluye un Pago por Oferta Anticipada. El precio de compra se determinará en función de un diferencial fijo más el rendimiento del título de referencia aplicable el 3 de octubre de 2024. Suncor tiene la intención de financiar las compras con efectivo disponible.

선코어 에너지(Suncor Energy) (TSX: SU) (NYSE: SU)는 최대 8억 캐나다 달러의 현금으로 일부 보유된 채권 시리즈를 매입하기 위한 입찰을 발표했습니다. 제안은 두 개의 풀로 나뉩니다:

풀 1 (최대 7억 캐나다 달러): 2038년에 만기되는 6.50% 채권과 6.80% 채권

풀 2 (최대 1억 캐나다 달러): 2026년에서 2042년 사이에 만기가 도래하는 여러 시리즈의 채권

입찰은 2024년 10월 18일에 종료됩니다. 2024년 10월 2일의 조기 입찰일 이전에 입찰한 보유자는 조기 입찰 지급금을 포함한 총 보상에 대한 자격이 주어집니다. 구매 가격은 고정 스프레드와 2024년 10월 3일 기준의 관련 참조 증권 수익률에 따라 결정됩니다. 선코어는 현금을 통해 구매를 재원할 예정입니다.

Suncor Energy (TSX: SU) (NYSE: SU) a annoncé des offres de rachat en espèces pour certaines séries de billets en circulation pour un prix d'achat total pouvant atteindre 800 millions de dollars canadiens, hors intérêts courus. Les offres de rachat sont divisées en deux groupes :

Groupe 1 (maximum 700 millions de dollars canadiens) : Billets à 6,50 % arrivant à échéance en 2038 et billets à 6,80 % arrivant à échéance en 2038

Groupe 2 (maximum 100 millions de dollars canadiens) : Différentes séries de billets arrivant à échéance entre 2026 et 2042

Les offres de rachat expireront le 18 octobre 2024. Les titulaires qui soumettent leur offre avant la date limite d'offre anticipée du 2 octobre 2024, seront éligibles pour la contrepartie totale, qui comprend un paiement pour offre anticipée. Le prix d'achat sera déterminé en fonction d'un écart fixe plus le rendement du titre de référence applicable le 3 octobre 2024. Suncor prévoit de financer les achats avec des liquidités disponibles.

Suncor Energy (TSX: SU) (NYSE: SU) hat Tenderangebote für den Kauf bestimmter ausstehender Notenausgaben zu einem Gesamtkaufpreis von bis zu 800 Millionen kanadischen Dollar, ohne aufgelaufene Zinsen, angekündigt. Die Tenderangebote sind in zwei Pools unterteilt:

Pool 1 (max. 700 Millionen kanadische Dollar): 6,50% Anleihen mit Fälligkeit 2038 und 6,80% Anleihen mit Fälligkeit 2038

Pool 2 (max. 100 Millionen kanadische Dollar): Verschiedene Serien von Anleihen mit Fälligkeit zwischen 2026 und 2042

Die Tenderangebote laufen am 18. Oktober 2024 ab. Inhaber, die vor dem frühen Tenderdatum am 2. Oktober 2024 anbieten, können die gesamte Gegenleistung, einschließlich einer frühen Tenderzahlung, erhalten. Der Kaufpreis wird basierend auf einer festen Spanne zuzüglich der Rendite des betreffenden Referenzwerts am 3. Oktober 2024 festgelegt. Suncor plant, die Käufe mit verfügbaren liquiden Mitteln zu finanzieren.

Positive
  • Suncor is offering to repurchase up to C$800 million of outstanding notes, potentially reducing its debt load
  • Early tender offers include additional payments, incentivizing noteholders to participate quickly
  • The company plans to use cash on hand to fund the purchases, indicating strong liquidity
Negative
  • The tender offers may result in a significant cash outlay of up to C$800 million, reducing Suncor's available cash reserves

Insights

Suncor's tender offer for up to C$800 million of its outstanding notes is a strategic move to manage its debt profile. By repurchasing these notes, Suncor can potentially reduce its interest expenses and extend its debt maturity profile. The company is targeting notes with maturities ranging from 2026 to 2042, indicating a focus on long-term debt management.

The tender offer's structure, with two separate pools and priority levels, allows Suncor to prioritize which notes it repurchases. This flexibility is important in optimizing its debt structure. The use of cash on hand to fund the purchases suggests Suncor has a strong liquidity position, which is positive for the company's financial health.

However, investors should note that this move might reduce Suncor's cash reserves, potentially impacting its ability to invest in growth opportunities or weather market downturns. Overall, this tender offer appears to be a prudent financial management decision, balancing debt reduction with maintaining financial flexibility.

Suncor's tender offer sends a positive signal to the market about its financial management and confidence in its cash flow. By offering to repurchase notes at a premium (including an Early Tender Payment), Suncor is demonstrating its willingness to reward bondholders, which could enhance its reputation in the debt markets.

The timing of this offer is interesting, coming amidst volatile energy markets. It suggests Suncor sees an opportunity to optimize its capital structure despite market uncertainties. The company's ability to make this offer might indicate strong operational performance and positive cash flow expectations.

For investors, this move could be seen as a vote of confidence in Suncor's financial position. However, it's important to monitor how this impacts Suncor's financial ratios and credit ratings. While debt reduction is generally positive, the use of cash reserves could affect liquidity metrics. Overall, this tender offer is likely to be viewed favorably by both equity and debt investors, potentially supporting Suncor's stock and bond prices in the near term.

Calgary, Alberta--(Newsfile Corp. - September 19, 2024) - Suncor Energy Inc. (TSX: SU) (NYSE: SU) ("Suncor") announced today the commencement of tender offers to purchase for cash certain of its outstanding series of notes listed in the table below (collectively, the "Notes") for an aggregate purchase price, excluding accrued and unpaid interest, of up to C$800 million (collectively, the "Tender Offers").


Title of Security(1)CUSIP/ISINPrincipal Amount
Outstanding
Maximum Amount(2)Acceptance Priority
Level(3)
Par Call Date(4)Maturity DateReference
Security
Bloomberg Reference
Page
Fixed Spread(5)(6)
Pool 1 Tender Offers6.50% Notes due 2038867229AE6 / US867229AE68US$954,042,000C$700,000,0001N/AJune 15, 20383.875% UST due August 15, 2034FIT1135
6.80% Notes due 2038(7)71644EAJ1 /
US71644EAJ10
US$881,081,0002N/AMay 15, 20383.875% UST due August 15, 2034FIT1140
Pool 2 Tender Offers3.10% Series 6 Medium Term Notes due 202986721ZAP4 / CA86721ZAP41C$78,743,000C$100,000,0001February 24, 2029May 24, 20292.25% Government of Canada Bond due June 1, 2029 FIT CAN0-50120
3.00% Series 5 Medium Term Notes due 202686721ZAM1 / CA86721ZAM10C$115,182,0002June 14, 2026September 14, 20261.50% Government of Canada Bond due June 1, 2026 FIT CAN0-5070
6.00% Notes due 2042(8)13643EAH8, C18885AF7 / US13643EAH80, USC18885AF71US$31,625,0003October 1, 2041April 1, 20424.125% UST due August 15, 2044FIT1200
5.35% Notes due 2033(7)716442AH1 / US716442AH16US$118,367,0004N/AJuly 15, 20333.875% UST due August 15, 2034FIT1105
5.95% Notes due 2035(7)71644EAG7 / US71644EAG70US$199,271,0005N/AMay 15, 20353.875% UST due August 15, 2034FIT1125
5.00% Series 7 Medium Term Notes due 203086721ZAQ2 / CA86721ZAQ24C$154,041,0006January 9, 2030April 9, 20301.25% Government of Canada Bond due June 1, 2030 FIT CAN0-50125
5.39% Series 4 Medium Term Notes due 203786721ZAB5 / CA86721ZAB54C$279,124,0007N/AMarch 26, 20372.75% Government of Canada Bond due December 1, 2055FIT CAN0-50165

 

(1) The 6.50% Notes due 2038, 6.80% Notes due 2038, 6.00% Notes due 2042, 5.35% Notes due 2033 and 5.95% Notes due 2035 are referred to herein as the "US$ Notes." The 3.10% Series 6 Medium Term Notes due 2029, 3.00% Series 5 Medium Term Notes due 2026, 5.00% Series 7 Medium Term Notes due 2030 and 5.39% Series 4 Medium Term Notes due 2037 are referred to herein as the "C$ Notes."
(2) C$700,000,000 represents the maximum aggregate purchase price payable, excluding the applicable accrued and unpaid interest (the "Pool 1 Maximum Amount"), in respect of the 6.50% Notes due 2038 and 6.80% Notes due 2038, which may be purchased in the Pool 1 Tender Offers. C$100,000,000 represents the maximum aggregate purchase price payable, excluding the applicable accrued and unpaid interest (the "Pool 2 Maximum Amount" and, together with the Pool 1 Maximum Amount, the "Maximum Amounts"), in respect of the 3.10% Series 6 Medium Term Notes due 2029, 3.00% Series 5 Medium Term Notes due 2026, 6.00% Notes due 2042, 5.35% Notes due 2033, 5.95% Notes due 2035, 5.00% Series 7 Medium Term Notes due 2030 and 5.39% Series 4 Medium Term Notes due 2037, which may be purchased in the Pool 2 Tender Offers. For purposes of calculating the portion of the Maximum Amounts attributable to each series of US$ Notes, the aggregate principal amount of US$ Notes tendered in the applicable Tender Offer shall be converted to Canadian dollars based on the exchange rate of one U.S. dollar for Canadian dollars, as shown on the FXC page displayed on the Bloomberg Pricing Monitor at 11:00 a.m., New York City time, on the Price Determination Date (as defined below).
(3) Subject to the Maximum Amounts and proration, if applicable, the principal amount of each series of Notes that is purchased in each Tender Offer will be determined in accordance with the applicable Acceptance Priority Level (in numerical priority order) specified in this column in the manner described in the Offer to Purchase.
(4) The calculation of the applicable U.S. Total Consideration (as defined below) for each series of US$ Notes and the calculation of the applicable Canadian Total Consideration (as defined below) for each series of C$ Notes will be performed taking into account such par call date, if any, or maturity date, in accordance with market practice.
(5) The applicable consideration for each series of US$ Notes (the "U.S. Total Consideration") offered per each US$1,000 principal amount of each series of US$ Notes validly tendered prior to or at the Early Tender Date (as defined below) and accepted for purchase pursuant to the applicable Tender Offer will be determined in the manner described in the Offer to Purchase by reference to the applicable fixed spread for such Notes (the "Fixed Spread") specified in the table above, plus the applicable yield based on the bid-side price of the applicable U.S. reference security specified in the table above as displayed on the applicable Bloomberg Reference Page at 11:00 a.m., New York City time, on October 3, 2024 (such date and time, as it may be extended with respect to a Tender Offer, the applicable "Price Determination Date"). The applicable consideration for each series of C$ Notes (the "Canadian Total Consideration" and, together with the U.S. Total Consideration, the "Total Consideration") offered per C$1,000 principal amount of each series of C$ Notes validly tendered prior to or at the Early Tender Date and accepted for purchase pursuant to the applicable Tender Offer will be determined in the manner described in the Offer to Purchase by reference to the applicable Fixed Spread specified in the table above, plus the applicable yield based on the bid-side price of the applicable Canadian reference security specified in the table above as displayed on the applicable Bloomberg Reference Page at 11:00 a.m., New York City time, on the Price Determination Date. The Total Consideration for each series of Notes is inclusive of the applicable Early Tender Payment (as defined below). The Total Consideration for each series of Notes does not include the applicable accrued and unpaid interest, which will be payable in addition to the applicable Total Consideration.
(6) The U.S. Total Consideration and Canadian Total Consideration include the Early Tender Payment of US$30 and C$30 per US$1,000 and C$1,000, respectively, principal amount of Notes validly tendered prior to or at the Early Tender Date and accepted for purchase.
(7) Such Notes were issued by Petro-Canada; Suncor assumed the obligations for such Notes in 2009.
(8) Such Notes were issued by Canadian Oil Sands Limited; Suncor assumed the obligations for such Notes in 2016.

The Tender Offers are being made upon the terms, and subject to the conditions, described in the offer to purchase dated September 19, 2024 (as it may be amended or supplemented from time to time, the "Offer to Purchase"), which sets forth a detailed description of the Tender Offers. Suncor reserves the right, but is under no obligation, to increase or decrease either of the Maximum Amounts in the table above in its sole discretion, at any time, without extending or reinstating withdrawal rights, subject to compliance with applicable law.

The Tender Offers for the Notes will expire at 5:00 p.m., New York City time, on October 18, 2024, or any other date and time to which Suncor extends the applicable Tender Offer (such date and time, as it may be extended with respect to a Tender Offer, the "Expiration Date"), unless earlier terminated. Holders of Notes must validly tender and not validly withdraw their Notes prior to or at 5:00 p.m., New York City time, on October 2, 2024 (such date and time, as it may be extended with respect to a Tender Offer, the applicable "Early Tender Date"), to be eligible to receive the applicable Total Consideration, which is inclusive of an amount in cash equal to US$30 and C$30 per US$1,000 and C$1,000, respectively, principal amount of Notes validly tendered prior to or at the Early Tender Date and accepted for purchase (the "Early Tender Payment"), plus accrued and unpaid interest (as described below). If a holder validly tenders Notes after the applicable Early Tender Date but prior to or at the applicable Expiration Date, the holder will only be eligible to receive the applicable Late Tender Offer Consideration (as defined below), plus accrued and unpaid interest (as described below).

The U.S. Total Consideration offered per US$1,000 principal amount of each series of US$ Notes validly tendered prior to or at the Early Tender Date and accepted for purchase pursuant to the applicable Tender Offer will be determined in the manner described in the Offer to Purchase by reference to the applicable Fixed Spread plus the applicable yield based on the bid-side price of the applicable U.S. reference security as displayed on the applicable Bloomberg Reference Page at 11:00 a.m., New York City time, on the Price Determination Date. The applicable Canadian Total Consideration for each series of C$ Notes offered per C$1,000 principal amount of each series of C$ Notes validly tendered prior to or at the Early Tender Date and accepted for purchase pursuant to the applicable Tender Offer will be determined in the manner described in the Offer to Purchase by reference to the applicable Fixed Spread plus the applicable yield based on the bid-side price of the applicable Canadian reference security as displayed on the applicable Bloomberg Reference Page at 11:00 a.m., New York City time, on the Price Determination Date.

The "Late Tender Offer Consideration" for each series of Notes is equal to the Total Consideration minus the Early Tender Payment for each series of Notes. Holders will also receive accrued and unpaid interest on Notes validly tendered and accepted for purchase from the applicable last interest payment date up to, but not including, the applicable settlement date.

Suncor intends to fund the purchase of validly tendered and accepted Notes with cash on hand.

The Tender Offers will expire on the applicable Expiration Date. Provided that the conditions of the applicable Tender Offer are satisfied, and except as set forth below, payment for the Notes validly tendered prior to or at the Expiration Date, and accepted for purchase, will be made on a date promptly following the Expiration Date, which is anticipated to be October 22, 2024, the second business day following the Expiration Date. Suncor reserves the right, in its sole discretion, to make payment for Notes validly tendered prior to or at the Early Tender Date and accepted for purchase on an earlier settlement date, which, if applicable, is currently anticipated to be October 7, 2024, the third business day following the Early Tender Date.

Tendered Notes may be withdrawn prior to or at, but not after, 5:00 p.m., New York City time, on October 2, 2024, unless extended or earlier terminated by Suncor.

All Notes accepted for purchase will be retired and cancelled and will no longer remain outstanding obligations of Suncor.

The Tender Offers are subject to the satisfaction or waiver of certain conditions, which are specified in the Offer to Purchase. The Tender Offers are not conditioned on any minimum principal amount of Notes being tendered.

Information relating to the Tender Offers

CIBC World Markets Corp., CIBC World Markets Inc. (solely with respect to the Tender Offers for the C$ Notes) (together, "CIBC"), J.P. Morgan Securities LLC, J.P. Morgan Securities Canada Inc. (solely with respect to the Tender Offers for the C$ Notes) (together, "J.P. Morgan"), Mizuho Securities USA LLC, Mizuho Securities Canada Inc. (solely with respect to the C$ Tender Offers) (together, "Mizuho"), RBC Capital Markets, LLC, RBC Dominion Securities Inc. (solely with respect to the Tender Offers for the C$ Notes) (together, "RBC"), Scotia Capital (USA) Inc. ("Scotiabank"), TD Securities (USA) LLC and TD Securities Inc. (solely with respect to the Tender Offers for the C$ Notes) (together, "TD Securities") are acting as the Dealer Managers for the Tender Offers. For additional information regarding the terms of the Tender Offers, please contact CIBC at (800) 282-0822 (toll free) or (212) 455-6427 (collect), J.P. Morgan at (866) 834-4666 (toll free) or (212) 834-4818 (collect), Mizuho at (866) 271-7403 (toll free) or (212) 205-7736 (collect), RBC at (877) 381-2099 (toll free), (212) 618-7843 (collect U.S.) or (416) 842-6311 (collect Canada), Scotiabank at (800) 372-3930 (toll free) or (212) 225-5000 (collect), or TD Securities at (866) 584-2096 (toll free), (212) 827-2842 (collect U.S.) or (416) 982-2243 (collect Canada). Global Bondholder Services Corporation will act as the information agent and the tender agent for the Tender Offers for the US$ Notes. Computershare Investor Services Inc. will act as the tender agent for the Tender Offers for the C$ Notes. Questions or requests for assistance related to the Tender Offers or for additional copies of the Offer to Purchase may be directed to Global Bondholder Services Corporation at (855) 654-2014 (toll free) or (212) 430-3774 (collect). You may also contact your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Tender Offers. The Offer to Purchase can be accessed at the following website: https://www.gbsc-usa.com/suncor.

The full details of the Tender Offers, including complete instructions on how to tender Notes, are included in the Offer to Purchase. Holders are strongly encouraged to carefully read the Offer to Purchase, including the documents incorporated by reference therein, because they contain important information. The Offer to Purchase may be obtained from Global Bondholder Services Corporation, free of charge, by calling (212) 430-3774 (for banks and brokers) or (855) 654-2014 (for all others, toll-free).

This news release does not constitute an offer to purchase, or a solicitation of an offer to sell, or the solicitation of tenders with respect to the Notes. No offer, solicitation, purchase or sale will be made in any jurisdiction in which such an offer, solicitation or sale would be unlawful. The Tender Offers are being made solely pursuant to the Offer to Purchase made available to holders of the Notes. None of Suncor or its affiliates, their respective boards of directors, the dealer managers, the tender agents, the information agent or the trustee with respect to any series of Notes is making any recommendation as to whether or not holders should tender or refrain from tendering all or any portion of their Notes in response to the Tender Offers. Holders are urged to evaluate carefully all information in the Offer to Purchase, consult their own investment and tax advisors and make their own decisions whether to tender Notes in the Tender Offers, and, if so, the principal amount of Notes to tender.

Legal Advisory – Forward-Looking Information

This news release contains certain forward-looking information and forward-looking statements (collectively referred to herein as "forward-looking statements") within the meaning of applicable Canadian and U.S. securities laws. Forward-looking statements are based on Suncor's current expectations, estimates, projections and assumptions that were made by the company in light of information available at the time the statement was made and consider Suncor's experience and its perception of historical trends. Forward-looking statements in this news release include statements about the purchase of the Notes and amount of the consideration paid therefor; the expected source of funds for the Tender Offers; the deadlines, determination dates and settlement dates specified herein in regards to the Tender Offers; increasing or decreasing the Maximum Amounts; and the payment of accrued and unpaid interest.

Forward-looking statements and information are not guarantees of future performance and involve a number of risks and uncertainties, some that are similar to other oil and gas companies and some that are unique to Suncor. Suncor's actual results may differ materially from those expressed or implied by its forward-looking statements, so readers are cautioned not to place undue reliance on them.

Suncor's Management Discussion and Analysis for the Second Quarter of 2024 dated August 6, 2024, its Annual Information Form, Annual Report to Shareholders and Form 40-F, each dated March 21, 2024, and other documents it files from time to time with securities regulatory authorities describe the risks, uncertainties, material assumptions and other factors that could influence actual results and such factors are incorporated herein by reference. Copies of these documents are available without charge from Suncor at 150 6th Avenue S.W., Calgary, Alberta T2P 3E3; by referring to suncor.com/FinancialReports or to the company's profile on SEDAR+ at sedarplus.ca or EDGAR at sec.gov. Except as required by applicable securities laws, Suncor disclaims any intention or obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Suncor Energy is Canada's leading integrated energy company. Suncor's operations include oil sands development, production and upgrading; offshore oil production; petroleum refining in Canada and the U.S.; and the company's Petro-CanadaTM retail and wholesale distribution networks (including Canada's Electric HighwayTM, a coast-to-coast network of fast-charging EV stations). Suncor is developing petroleum resources while advancing the transition to a lower-emissions future through investments in lower emissions intensity power, renewable feedstock fuels and projects targeting emissions intensity. Suncor also conducts energy trading activities focused primarily on the marketing and trading of crude oil, natural gas, byproducts, refined products and power. Suncor's common shares (symbol: SU) are listed on the Toronto and New York stock exchanges.

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For more information about Suncor, visit our website at suncor.com.

Media inquiries:
(833) 296-4570
media@suncor.com

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/223928

FAQ

What is the maximum aggregate purchase price for Suncor's (SU) tender offers?

Suncor (SU) has announced tender offers for an aggregate purchase price of up to C$800 million, excluding accrued and unpaid interest.

When do Suncor's (SU) tender offers expire?

Suncor's (SU) tender offers are set to expire at 5:00 p.m., New York City time, on October 18, 2024, unless extended or earlier terminated.

What is the Early Tender Date for Suncor's (SU) tender offers?

The Early Tender Date for Suncor's (SU) tender offers is 5:00 p.m., New York City time, on October 2, 2024, unless extended.

How does Suncor (SU) plan to fund the purchase of tendered notes?

Suncor (SU) intends to fund the purchase of validly tendered and accepted notes with cash on hand.

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