ENQUEST PLC LAUNCHES CONSENT SOLICITATION IN RESPECT OF ITS £155,000,000 5.50
PER CENT. NOTES DUE 2022
NOT FOR DISTRIBUTION, DIRECTLY OR INDIRECTLY, TO, OR FOR THE ACCOUNT OR BENEFIT
OF, U.S. PERSONS (AS SUCH TERM IS DEFINED IN REGULATION S UNDER THE U.S.
SECURITIES ACT OF 1933 AS AMENDED) OR IN OR INTO THE UNITED STATES (INCLUDING
ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES AND THE DISTRICT
OF COLUMBIA) OR ANY OTHER JURISDICTION WHERE IT IS UNLAWFUL TO DISTRIBUTE THE
CONSENT SOLICITATION MEMORANDUM (AS DEFINED BELOW).
10 April 2015
EnQuest PLC (the "Company") today announces that it is inviting holders
("Noteholders") of its outstanding £155,000,000 5.50 per cent. Notes due 15
February 2022 (the "Notes") (ISIN: XS0880578728, Common Code: 088057872) issued
pursuant to its £500,000,000 Euro Medium Term Note Programme to consent to
certain modifications to the terms and conditions of the Notes (the
"Conditions") and the trust deed dated 24 January 2013 as amended and
supplemented from time to time (the "Trust Deed") between the Company and U.S.
Bank Trustees Limited (the "Trustee") constituting the Notes (such invitation,
the "Consent Solicitation"), as described briefly below and in more detail in a
consent solicitation memorandum dated 10 April 2015 (the "Consent Solicitation
Memorandum").
The proposals that the Company is inviting Noteholders to approve will, if
approved and implemented, modify the Conditions and the Trust Deed (by the
execution of a supplemental deed to the Trust Deed (the "Supplemental Trust
Deed")) as follows (together, the "Proposals"):
(a) to amend the financial covenants such that, in respect of any
Reference Date falling during a limited period from the date on which the
Supplemental Trust Deed is duly executed to (and including) 31
December 2016 (the "Covenant Amendment End Date"):
(i) the Leverage Ratio shall be less than 5.0:1.0
(currently 3.0:1.0); and
(ii) the ratio of EBITDA to Finance Charges shall be
not less than 3.0:1.0 (currently 4.0:1.0),
after which time such financial covenants will revert to the
current levels, which shall remain in effect until the date on which the
Supplemental Trust Deed shall have been duly executed; and
(b) to amend the Rate of Interest for a limited period of time such
that if the Company delivers to the Trustee a compliance certificate in
respect of any Reference Date occurring after the date on which
the Supplemental Trust Deed is duly executed to (and including)
the Covenant Amendment End Date certifying that the Leverage
Ratio was more than 3.0:1.0, the Rate of Interest for the
immediate next following Interest Period commencing after the
date of such compliance certificate shall be 7.00 per cent. per annum.
The Proposals seek to bring the financial covenant levels in the Notes into line
with the amended covenants in the Company's secured revolving credit facility,
as announced by the Company on 23 January 2015. The financial covenants in the
Notes would revert to their current levels from (and including) the Reference
Date on 30 June 2017.
The Proposals include all consequential amendments necessary to implement the
above modifications.
In connection with the Consent Solicitation, the Company's CEO Amjad Bseisu
said:
"This is a prudent and precautionary step to provide us with the flexibility to
complete the capital expenditure programme that will significantly enhance the
Group's production and cash flow. This brings the Leverage Ratio in the Notes in
line with our revolving credit facility whilst offering Noteholders a coupon of
7.00 per cent. if the Leverage Ratio is three times or above. We consider the
Proposals to be fair for Noteholders and are encouraged by initial indicative
support from Noteholders representing approximately 42 per cent. in aggregate
principal amount of the outstanding Notes."
The Consent Solicitation is made on the terms and subject to the conditions
contained in the Consent Solicitation Memorandum and should be read in
conjunction with such Consent Solicitation Memorandum. Capitalised terms used
but not otherwise defined in this announcement shall have the meaning given to
them in the Consent Solicitation Memorandum.
An indicative timetable for the Consent Solicitation is set out below and in the
Consent Solicitation Memorandum.
RATIONALE FOR THE PROPOSALS
While the Company believes that it will be able to operate within the limits
imposed by the Group's borrowings (including the financial covenants under the
Notes which the Company proposes to modify by the Consent Solicitation), further
sustained falls in the oil price or other adverse developments would reduce
headroom and could impact the Group's ability to implement its capital
expenditure programme. Therefore, as a prudent and precautionary measure, the
Company is seeking an amendment to the Notes to bring the financial covenant
levels in the Notes into line with the amended covenants in the Company's
secured revolving credit facility, as announced on 23 January 2015. The
financial covenants in the Notes would revert to their current levels from (and
including) the Reference Date on 30 June 2017.
Continued compliance with all of the covenants imposed by the Group's borrowings
remains a priority for the current financial year and beyond. As such, the
Proposals would provide the Group with continued flexibility of funding to
implement its capital expenditure programme.
Support of certain Noteholders
The Proposals have been considered by a number of significant holders of Notes
approached by the Company on a confidential basis. Based on feedback from such
Noteholders, the Company has received indicative support for the Proposals from
Noteholders representing approximately 42 per cent. in aggregate principal
amount of the outstanding Notes.
CONSENT FEE
Noteholders who vote in favour of the Extraordinary Resolution by delivering or
procuring the delivery of a Consent Instruction (which is not validly revoked)
will be eligible to receive a Consent Fee of 0.20 per cent. of the aggregate
principal amount of Notes which are the subject of such Consent Instruction. In
order to be eligible to receive such Consent Fee, the Tabulation Agent must
receive such Consent Instruction by the Voting Deadline.
The Consent Fee will be payable in one instalment on the Consent Fee Payment
Date only if the Extraordinary Resolution in respect of the Proposals has been
approved and the Supplemental Trust Deed has been duly executed.
MEETING OF NOTEHOLDERS
Notice (the "Notice") of a meeting (the "Meeting") of the Noteholders to be held
at the offices of Ashurst LLP at Broadwalk House, 5 Appold Street, London EC2A
2HA, United Kingdom at 10.00 a.m. (London time) on 5 May 2015 has been published
in accordance with the Trust Deed.
At the Meeting, Noteholders will be asked to consider and, if thought fit, pass
an extraordinary resolution as set out in the Notice (the "Extraordinary
Resolution"), which will provide, among other things, for the Trustee to be
authorised and requested to concur in and execute the Supplemental Trust Deed,
which will implement the Proposals and effect the modifications to the
Conditions and Trust Deed outlined in the Consent Solicitation Memorandum.
If the Extraordinary Resolution is passed, the proposed modifications to the
Conditions and the Trust Deed will be binding on all Noteholders, including
those Noteholders who do not vote in respect of, or vote against, the Proposals.
INDICATIVE TIMETABLE FOR THE CONSENT SOLICITATION
Event Date and Time
Announcement 10 April 2015
of the
Consent
Solicitation
and the
Proposals
Notice of
Meeting
published.
Revocation 10:00 a.m. (London time) on 1 May 2015
Deadline
Latest time
for
Noteholders
to deliver or
procure
delivery on
their behalf
to the
Tabulation
Agent of a
valid
instruction
revoking
previously
submitted
Consent
Instructions.
Voting 10:00 a.m. (London time) on 1 May 2015
Deadline
Deadline for
Noteholders
to deliver or
procure
delivery on
their behalf
to the
Tabulation
Agent of a
Consent
Instruction
in favour of
the
Extraordinary
Resolution.
Deadline for 5:00 p.m. (London time) on 1 May 2015
appointing a
proxy in
respect of
the Notes
The latest
time for
appointing a
proxy (other
than the
Tabulation
Agent) to
attend and
vote at the
Meeting in
person.
Meeting 10:00 a.m. (London time) on 5 May 2015
Time and date
of the
Meeting.
Announcement As soon as reasonably practicable after the Meeting has
and concluded and, in any event, within 14 days of the Meeting.
publication
of results of
Meeting
Announcement
of the
results of
the Meeting.
Consent Fee No later than the tenth Business Day after the date on which
Payment Date the Extraordinary Resolution is approved and the Supplemental
The date on Trust Deed is duly executed.
which the
Consent Fee
will be paid
to Direct
Participants
if the
Extraordinary
Resolution is
approved and
the
Supplemental
Trust Deed is
duly
executed.
The above times and deadlines are subject to the right of the Company to amend,
extend or waive any condition of and/or terminate the Consent Solicitation
(subject to applicable law and as provided in the Consent Solicitation
Memorandum). Noteholders are advised to check with any broker, dealer, bank,
custodian, trust company or other trustee through which they hold Notes whether
such broker, dealer, bank, custodian, trust company or other trustee would
require receiving any notice or instructions prior to the deadlines set out
above.
GENERAL
Details of how to participate in the Consent Solicitation are set out in the
Consent Solicitation Memorandum. Noteholders may obtain a copy of the Consent
Solicitation Memorandum by contacting the Tabulation Agent, the contact details
of which are set out immediately below.
Notices throughout the Consent Solicitation will be published in accordance with
all applicable rules and regulations as follows:
(a) a notice in Euroclear Bank S.A./N.V. and Clearstream Banking,
société anonyme for communication to accountholders;
(b) an announcement released on the London Stock Exchange plc's
regulatory news service; and
(c) a notice published on Bloomberg,
and by any other means as the Company may, in its absolute discretion, consider
appropriate.
CONTACT INFORMATION
Documents relating to the Consent Solicitation can be obtained from the
Company's website at www.enquest.com/investors/retail-bond.aspx.
Requests for further information in relation to the Consent Solicitation should
be directed to the Company's Financial Advisers:
Evercore Partners International LLP Numis Securities Limited
15, Stanhope Gate 10 Paternoster Square
London W1K 1LN London EC4M 7LT
Email: swag.ganguly@evercore.com Email: m.dyson@numis.com
Telephone: +44 (0)20 7653 6199 Telephone: +44 (0)20 7260 1351
Requests for copies of the Consent Solicitation Memorandum and information in
relation to the procedures for submission of a Consent Instruction should be
directed to the Tabulation Agent:
Lucid Issuer Services Limited
Leroy House
436 Essex Road
London N1 3QP
Email: enquest@lucid-is.com
Telephone: +44 (0)20 7704 0880
Attention: David Shilson
Media enquiries should be directed to Bell Pottinger:
Telephone: +44 (0)20 3772 2500
Attention: Victoria Geoghegan
Nick Lambert
Duncan Mayall
DISCLAIMER AND CONSENT SOLICITATION RESTRICTIONS
The Consent Solicitation Memorandum contains important information which should
be read carefully before any decision is made in respect of the Proposals, as
defined and more fully described herein.
If you are in any doubt as to the action you should take, you are recommended to
seek your own financial advice, including in respect of any tax consequences,
immediately from your stockbroker, bank manager, solicitor, accountant or other
independent financial adviser authorised under the Financial Services and
Markets Act 2000 as amended (if you are in the United Kingdom) or from another
appropriately authorised independent financial adviser (if you are not).
Noteholders who wish to vote and whose Notes are held in the name of a broker,
dealer, commercial bank, trust company or other nominee institution (including
as CDIs) must contact such nominee promptly and instruct or make arrangements
with such nominee to vote in accordance with the customary procedures of the
Clearing Systems on behalf of the Noteholders. The deadlines set by any such
custodial entity and each Clearing System for the submission of a Consent
Instruction in connection with the Extraordinary Resolutions may be earlier than
the relevant deadlines specified above and in the Consent Solicitation
Memorandum.
Before making a decision with respect to the Consent Solicitation, Noteholders
should carefully consider all of the information in the Consent Solicitation
Memorandum and, in particular, the risk factors described therein.
No person is authorised in connection with the Consent Solicitation to give any
information or to make any representation not contained in the Consent
Solicitation Memorandum and any information or representation not contained in
the Consent Solicitation Memorandum must not be relied upon as having been
authorised by the Company, the Financial Advisers, the Trustee, the Paying Agent
or the Tabulation Agent. The Financial Advisers, the Paying Agent and the
Tabulation Agent are agents of the Company and owe no duty to any holder of the
Notes. The Consent Solicitation Memorandum is only issued to and directed at
Noteholders for the purposes of considering the Extraordinary Resolution. No
other person may rely upon its contents, and it should not be relied upon by
Noteholders for any other purpose. None of the Company, the Financial Advisers,
the Trustee, the Paying Agent or the Tabulation Agent, or any of their
respective directors or employees, makes any recommendation whether Noteholders
should approve the Proposals described in the Consent Solicitation Memorandum.
Evercore Partners International LLP ("Evercore") and Numis Securities Limited
("Numis"), each of which is authorised and regulated in the United Kingdom by
the Financial Conduct Authority, are acting as financial advisors to the Company
and no-one else in connection with the Consent Solicitation and the other
matters referred to in this announcement. Evercore and Numis will not regard any
person other than the Company as their client in relation to the Consent
Solicitation and the other matters referred to in this announcement and will not
be responsible to anyone other than the Company for providing the protections
afforded to clients of Evercore or Numis (as the case may be) or for providing
advice in relation to the Consent Solicitation or the other matters referred to
in this announcement.
The distribution of the Consent Solicitation Memorandum in certain jurisdictions
may be restricted by law. Persons into whose possession the Consent Solicitation
Memorandum comes must inform themselves about and observe any such restrictions.
United States
The Consent Solicitation is not for distribution, directly or indirectly, in or
into the United States (including its territories and possessions, any State of
the United States and the District of Columbia). The matters contemplated by the
Consent Solicitation do not constitute or form a part of any offer or
solicitation to purchase or subscribe for any securities in the United States.
Any such securities have not been, and will not be, registered under the United
States Securities Act of 1933, as amended (the "Securities Act"). Any such
securities may not be offered or sold in the United States or to, or for the
account or benefit of, U.S. persons (as such term is defined in Regulation S
under the Securities Act), except pursuant to an exemption from the registration
requirements of the Securities Act. No public offering of securities will be
made in the United States or in any other jurisdiction where such an offering is
restricted or prohibited.
United Kingdom
The Consent Solicitation may only be communicated to persons in the United
Kingdom in circumstances where section 21(1) of the Financial Services and
Markets Act 2000 does not apply. Accordingly, the Consent Solicitation
Memorandum is only for circulation to persons inside the United Kingdom who fall
within one of the following categories:
(a) a person who is a holder of any Notes; or
(b) any other person also falling within Article 43(2) or within
Article 49(2)(a) to (d) of the Financial Services and Markets Act 2000
(Financial
Promotion) Order 2005 (the "Order") or falling within the
definition of "investment professionals" (as defined in Article 19(5) of the
Order).
The Consent Solicitation Memorandum is only available in the United Kingdom to
such persons, and the transactions contemplated herein will be available only
to, and may be engaged in only with, such persons.
General
In addition to the representation referred to above in respect of the United
States, each holder of Notes participating in the Consent Solicitation will also
be deemed to give certain other representations as set out in the Consent
Solicitation Memorandum. Any Consent Instruction from a Noteholder that is
unable to make these representations will not be accepted. Each of the Company,
the Financial Advisers, the Trustee, the Paying Agent and the Tabulation Agent
reserves the right, in each of its absolute discretion, to investigate whether
any such representation given by a Noteholder is correct and, if such
investigation is undertaken and, as a result, the Company determines (for any
reason) that such representation is not correct, such Consent Instruction may
not be accepted.
Enquest PLC 5.5 per cent notes update
| Source: EnQuest PLC
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