Southwestern Energy offers swap with Indigo noteholders
US natural gas producer Southwestern Energy said August 2 that it offered a swap for senior notes held by Indigo Natural Resources, a target of acquisition.
Southwestern said that holders of Indigo’s outstanding 5.375% senior notes due 2029 could swap those out for up to $700mn in similar notes issued by Southwestern.
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Southwestern in June announced plans to acquire Indigo, a producer in the Haynesville shale natural gas play, for $2.7bn. The deal is expected to close in the fourth quarter.
Indigo is among the largest private US natural gas producers, drawing on gas from the shale play spread out over northern Louisiana. It has a current production rate of around 1bn ft3/day and is positioned in close proximity to LNG demand corridors along the US Gulf Coast.
Southwestern reported its second quarter earnings results on July 29. It took a net loss for the three months ending June 30 of $609mn, compared with a net loss of $800mn during the same period last year. Adjusted Ebitda of $300mn was an improvement over the year-ago levels of $106mn. Net cash flow of $272mn was $185mn more than during the second quarter of 2020.
In terms of production, Southwestern reported that 79% of its total production during the quarter was in natural gas. Gas production over the three-month period of 219bn ft3 was a 38% increase over year-ago levels.