Vermilion Energy Inc. Announces the Closing of Its Senior Unsecured Notes Offering

Rhea-AI Summary

Vermilion Energy Inc. (TSX: VET) has successfully closed a private offering of US$400 million in 8-year senior unsecured notes, priced at 99.241% of par. The notes, which carry a fixed coupon of 6.875% per annum, are set to mature on May 1, 2030. Proceeds will be used to reduce the outstanding balance on Vermilion's revolving credit facility, which has been extended to May 29, 2026 and reduced to $1.6 billion. The offering was made on a prospectus-exempt basis in Canada and to qualified institutional buyers in the U.S.

Positive

• Successfully closed a US$400 million offering of senior unsecured notes.
• Notes priced at 99.241% of par, indicating strong demand.
• Coupon rate set at 6.875%, providing predictable income.
• Use of proceeds for debt reduction improves balance sheet stability.
• Extension of credit facility maturity to May 29, 2026, enhances liquidity.

Negative

• None.

CALGARY, AB, April 26, 2022 /PRNewswire/ - Vermilion Energy Inc. ("Vermilion", "We", "Our", "Us" or the "Company") (TSX: VET) (NYSE: VET) announces the closing of our previously announced private offering (the "Offering") of US$400 million aggregate principal amount of 8-year senior unsecured notes (the "New Notes"), which were priced at 99.241% of par. The New Notes mature on May 1, 2030 and have a fixed coupon of 6.875% per annum, paid semi-annually on May 1 and November 1, commencing November 1, 2022. The Company has given irrevocable notices to the lenders of its revolving credit facility that it will use the net proceeds from the New Notes to reduce the amount outstanding on the revolving credit facility. Contemporaneous with the closing of the New Notes, the maturity date of Vermilion's revolving credit facility was extended to May 29, 2026 (from May 31, 2024) and the total facility amount was reduced to Vermilion's targeted level of $1.6 billion (from $2.1 billion).

The New Notes have not been and will not be registered under the U.S. Securities Act of 1933, as amended ("U.S. Securities Act"), or applicable state securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws. The New Notes have not been and will not be qualified for sale to the public under applicable Canadian securities laws and, accordingly, any offer and sale of the New Notes in Canada will be made on a basis which is exempt from the prospectus requirements of such securities laws. Pursuant to the terms of the Offering, the New Notes will be offered and sold only on a prospectus-exempt basis to institutional "accredited investors" in certain provinces in Canada and, in the United States, will be offered and sold only to "qualified institutional buyers" in reliance on Rule 144A under the U.S. Securities Act and to certain non-U.S. persons in transactions outside the United States in reliance on Regulation S under the U.S. Securities Act.

This press release does not constitute an offer to sell or the solicitation of an offer to buy any security in any jurisdiction and shall not constitute an offer, solicitation or sale of any securities in any jurisdiction in which such offering, solicitation or sale would be unlawful.

About Vermilion

Vermilion is an international energy producer that seeks to create value through the acquisition, exploration, development and optimization of producing assets in North America, Europe and Australia. Our business model emphasizes free cash flow generation and returning capital to investors when economically warranted, augmented by value-adding acquisitions. Vermilion's operations are focused on the exploitation of light oil and liquids-rich natural gas conventional resource plays in North America and the exploration and development of conventional natural gas and oil opportunities in Europe and Australia.

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SOURCE Vermilion Energy Inc.

FAQ

What are the terms of Vermilion Energy's recent notes offering?

Vermilion Energy closed a US$400 million offering of 8-year senior unsecured notes at a fixed coupon of 6.875%, maturing on May 1, 2030.

What is the purpose of the proceeds from the notes offering by VET?

The proceeds will be used to reduce the outstanding amount on Vermilion's revolving credit facility.

When does Vermilion's revolving credit facility maturity extend to?

The maturity date of Vermilion's revolving credit facility has been extended to May 29, 2026.

Is the notes offering by Vermilion registered under U.S. securities laws?

No, the notes have not been registered under the U.S. Securities Act and are offered on a prospectus-exempt basis.

How much is Vermilion's total revolving credit facility after the recent adjustments?

Vermilion's total revolving credit facility is reduced to $1.6 billion.