CALGARY, Alberta, Sept. 19, 2023 (GLOBE NEWSWIRE) — Cenovus Energy Inc. (TSX: CVE) (NYSE: CVE) announced today the total consideration payable in connection with its previously announced tender offers to purchase for cash: (i) up to $500,000,000 aggregate purchase price, excluding accrued and unpaid interest (the “Pool 1 Maximum Amount”), of its 5.250% Notes due 2037, 4.450% Notes due 2042, 5.200% Notes due 2043, 4.400% Notes due 2029, 5.400% Notes due 2047 and 4.250% Notes due 2027 (collectively, the “Pool 1 Notes”) and (ii) up to $500,000,000 aggregate purchase price, excluding accrued and unpaid interest (the “Pool 2 Maximum Amount” and, together with the Pool 1 Maximum Amount, the “Maximum Amounts”), of its 6.800% Notes due 2037 and 6.750% Notes due 2039 (collectively, the “Pool 2 Notes” and, together with the Pool 1 Notes, the “Notes”), subject to prioritized acceptance levels listed in the table below (“Acceptance Priority Levels”) and the terms and conditions of the tender offers.
References to “$” in this news release are to United States dollars, unless otherwise indicated.
The table below sets forth, among other things, the aggregate principal amount of each series of Notes validly tendered and not validly withdrawn as of 5:00 p.m., New York City time, on September 18, 2023 (the “Early Tender Date”) and expected to be accepted for purchase in each tender offer, the approximate proration factor for such Notes and the Total Consideration for each series of such Notes, as calculated at 10:00 a.m., New York City time, today, September 19, 2023.
| Title of Security | CUSIP/ISIN | Principal Amount Outstanding |
Maximum Amount | Acceptance Priority Level(1) |
Series Tender Cap(2) | U.S. Treasury Reference Security |
Bloomberg Reference Page |
Fixed Spread |
Reference Yield | Principal Amount Tendered at Early Tender Date |
Principal Amount Expected to be Accepted |
Approximate Proration Factor |
Total Consideration (3)(4) |
||||||
| Pool 1 Tender Offers | 5.250% Notes due 2037 |
15135UAP4 / US15135UAP49
15135UAN9 / US15135UAN90 (144A) C23555AG7 / USC23555AG79 (Reg S) |
$583,102,000 | $500,000,000(5) | 1 | $250,000,000 | 3.875% UST due 8/15/33 |
FIT1 | + 175 bps | 4.343% | $400,387,000 | $250,000,000 | 62.49% | $922.21 | |||||
| 4.450% Notes due 2042 | 15135UAH2 / US15135UAH23 | $97,004,000 | 2 | N/A | 4.375% UST due 8/15/43 | FIT1 | + 200 bps | 4.600% | $5,688,000 | $5,688,000 | 100% | $769.18 | |||||||
| 5.200% Notes due 2043 | 15135UAK5 / US15135UAK51 | $28,549,000 | 3 | N/A | 4.375% UST due 8/15/43 | FIT1 | + 205 bps | 4.600% | $1,614,000 | $1,614,000 | 100% | $840.93 | |||||||
| 4.400% Notes due 2029 | 448055AP8 / US448055AP89 | $239,598,000 | 4 | N/A | 4.375% UST due 8/31/28 | FIT1 | + 145 bps | 4.487% | $57,128,000 | $57,128,000 | 100% | $927.97 | |||||||
| 5.400% Notes due 2047 | 15135UAR0 / US15135UAR05
15135UAQ2 / US15135UAQ22 (144A) C23555AH5 / USC23555AH52 (Reg S) |
$799,872,000 | 5 | N/A | 3.625% UST due 5/15/53 |
FIT1 | + 170 bps | 4.420% | $571,507,000 | $231,444,000 | 40.54% | $910.38 | |||||||
| Pool 2 Tender Offers | 6.800% Notes due 2037 | 448055AD5 / US448055AD59 | $386,773,000 | $500,000,000(6) | 1 | N/A | 3.875% UST due 8/15/33 |
FIT1 | + 200 bps | 4.343% | $195,551,000 | $195,551,000 | 100% | $1,041.95 | |||||
| 6.750% Notes due 2039 |
15135UAF6 / US15135UAF66 | $935,422,000 | 2 | N/A | 4.375% UST due 8/15/43 | FIT1 | + 170 bps | 4.600% | $398,009,000 | $283,462,000 | 71.29% | $1,045.09 | |||||||
| (1) | Subject to the Maximum Amounts, the Series Tender Cap (as defined below) and proration, the principal amount of each series of Notes that is expected to be purchased in each tender offer will be determined in accordance with the applicable Acceptance Priority Level (in numerical priority order) specified in this column. |
| (2) | The Pool 1 Notes with Acceptance Priority Level 1 (the “Capped Notes”) are subject to an aggregate principal amount sublimit of $250,000,000 (the “Series Tender Cap”). |
| (3) | Per $1,000 principal amount of Notes validly tendered prior to or at the Early Tender Date and accepted for purchase. |
| (4) | The Total Consideration for each series of Notes validly tendered prior to or at the Early Tender Date and accepted for purchase is calculated using the applicable Fixed Spread and is inclusive of the applicable Early Tender Payment. The Total Consideration for each series of Notes does not include accrued and unpaid interest, which will be payable in addition to the applicable Total Consideration. |
| (5) | Represents the maximum aggregate purchase price payable, excluding accrued and unpaid interest, in respect of the Pool 1 Notes that may be purchased in the tender offers. |
| (6) | Represents the maximum aggregate purchase price payable, excluding accrued and unpaid interest, in respect of the Pool 2 Notes that may be purchased in the tender offers. |
The tender offers are being made upon the terms, and subject to the conditions, previously described in the offer to purchase dated September 5, 2023, as amended and supplemented by Cenovus’s news release on September 19, 2023 (as so amended, the “Offer to Purchase”). Cenovus refers investors to the Offer to Purchase for the complete terms and conditions of the tender offers.
Withdrawal rights for the Notes expired at 5:00 p.m., New York City time, on the Early Tender Date. The tender offers for the Notes will expire at 5:00 p.m., New York City time, on October 3, 2023, or any other date and time to which Cenovus extends the applicable tender offer, unless earlier terminated. As previously announced, Cenovus expects to elect to exercise its right to make payment on September 20, 2023 (the “Early Settlement Date”) for Notes that were validly tendered prior to or at the Early Tender Date and that are accepted for purchase. Cenovus intends to fund the purchase of validly tendered and accepted Notes on the Early Settlement Date with cash on hand and certain short-term borrowings.
Because the Pool 1 Notes validly tendered and not validly withdrawn prior to or at the Early Tender Date have an aggregate purchase price, excluding accrued and unpaid interest, that exceeds the Pool 1 Maximum Amount, Cenovus does not expect to accept for purchase all Pool 1 Notes that have been validly tendered and not validly withdrawn prior to or at the Early Tender Date. Rather, subject to the Pool 1 Maximum Amount, the Series Tender Cap and the Acceptance Priority Levels set forth in the table above, in each case as further described in the Offer to Purchase, Cenovus expects to accept for purchase all of the 4.450% Notes due 2042, 5.200% Notes due 2043 and 4.400% Notes due 2029 validly tendered and not validly withdrawn prior to or at the Early Tender Date. Because the aggregate principal amount of the Capped Notes validly tendered and not validly withdrawn prior to or at the Early Tender Date exceeds the Series Tender Cap, Cenovus expects to accept for purchase $250,000,000 aggregate principal amount of the Capped Notes validly tendered and not validly withdrawn prior to or at the Early Tender Date on a prorated basis using a proration factor of approximately 62.49%. Cenovus expects to accept for purchase the 5.400% Notes due 2047 validly tendered and not validly withdrawn prior to or at the Early Tender Date on a prorated basis using a proration factor of approximately 40.54%. Cenovus does not expect to accept for purchase any 4.250% Notes due 2027. As described further in the Offer to Purchase, Notes tendered and not accepted for purchase will be promptly credited to the tendering holder’s account. Additionally, because the Pool 1 Notes validly tendered and not validly withdrawn prior to or at the Early Tender Date have an aggregate purchase price, excluding accrued and unpaid interest, that exceeds the Pool 1 Maximum Amount, Cenovus does not expect to accept for purchase any Pool 1 Notes tendered after the Early Tender Date on a subsequent settlement date.
Because the Pool 2 Notes validly tendered and not validly withdrawn prior to or at the Early Tender Date have an aggregate purchase price, excluding accrued and unpaid interest, that exceeds the Pool 2 Maximum Amount, Cenovus does not expect to accept for purchase all Pool 2 Notes that have been validly tendered and not validly withdrawn prior to or at the Early Tender Date. Rather, subject to the Pool 2 Maximum Amount and the Acceptance Priority Levels set forth in the table above, in each case as further described in the Offer to Purchase, Cenovus expects to accept for purchase all of the 6.800% Notes due 2037 validly tendered and not validly withdrawn prior to or at the Early Tender Date. Cenovus expects to accept for purchase the 6.750% Notes due 2039 validly tendered and not validly withdrawn prior to or at the Early Tender Date on a prorated basis using a proration factor of approximately 71.29%. As described further in the Offer to Purchase, Notes tendered and not accepted for purchase will be promptly credited to the tendering holder’s account. Additionally, because the Pool 2 Notes validly tendered and not validly withdrawn prior to or at the Early Tender Date have an aggregate purchase price, excluding accrued and unpaid interest, that exceeds the Pool 2 Maximum Amount, Cenovus does not expect to accept for purchase any Pool 2 Notes tendered after the Early Tender Date on a subsequent settlement date.
The applicable Total Consideration listed in the table above will be paid per $1,000 principal amount of each series of Notes validly tendered and accepted for purchase pursuant to the applicable tender offer on the Early Settlement Date. Only holders of Notes who validly tendered and did not validly withdraw their Notes prior to or at the Early Tender Date are eligible to receive the applicable Total Consideration for Notes accepted for purchase. 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 Early Settlement Date.
All Notes accepted for purchase will be retired and cancelled and will no longer remain outstanding obligations of Cenovus.
Cenovus’s obligation to accept for payment and to pay for Notes validly tendered and not validly withdrawn in the tender offers is subject to the satisfaction of certain conditions described in the Offer to Purchase. Cenovus reserves the right, subject to applicable law, to (i) waive any and all conditions to any of the tender offers, (ii) extend or terminate any of the tender offers, (iii) further increase or decrease either of the Maximum Amounts and/or increase, decrease or eliminate the Series Tender Cap, or (iv) otherwise further amend any of the tender offers. Cenovus may take any action described in clauses (i) through (iv) above with respect to one or more tender offers without having to do so for all tender offers.
Information relating to the tender offers
Goldman Sachs & Co. LLC, BMO Capital Markets Corp. and MUFG Securities Americas Inc. are the dealer managers for the tender offers. Investors with questions regarding the terms and conditions of the tender offers may contact Goldman Sachs & Co. LLC at (800) 828-3182 (toll-free) or by email at gs-lm-nyc@ny.email.gs.com, BMO Capital Markets Corp. at (833) 418-0762 (toll-free) or (212) 702-1840 (collect) or by email at LiabilityManagement@bmo.com and MUFG Securities Americas Inc. at (877) 744-4532 (toll-free) or (212) 405-7481 (collect). D.F. King & Co., Inc. is the tender and information agent for the tender offers. Investors with questions regarding the procedures for tendering Notes may contact the tender and information agent by email at cve@dfking.com, or by phone at (212) 269-5550 (for banks and brokers only) or (888) 644-5854 (for all others, toll-free). Beneficial owners may also contact their broker, dealer, commercial bank, trust company or other nominee for assistance.
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 read carefully the Offer to Purchase, including materials incorporated by reference therein, because they contain important information. The Offer to Purchase may be obtained from D.F. King & Co., Inc., free of charge, by calling (212) 269-5550 (for banks and brokers only) or (888) 644-5854 (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 Cenovus or its affiliates, their respective boards of directors, the dealer managers, the tender and 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.