Venoco, Inc. Announces Updated Financing Discussions
September 07 2012 - 7:00AM
Marketwired
Venoco, Inc. (NYSE: VQ) announced today that Denver Parent
Corporation ("DPC"), an affiliate of Timothy Marquez, Venoco's
Executive Chairman, has prepared a presentation with updated
details about its financing of the merger contemplated by the
merger agreement among Venoco, Mr. Marquez, DPC and another
affiliate of Mr. Marquez (the "Merger Agreement").
DPC has advised Venoco that as a result of strong demand for the
second lien term loan component of its financing, DPC expects the
size of that facility to be increased from $175 million to $225
million. Consequently, DPC expects the financing package to include
borrowings of $105 million under Venoco's existing revolving credit
facility, a $225 million second lien term loan at Venoco, and
capital raises by DPC in the amount of $230 million, including a
volumetric production payment on assets to be sold to DPC by Venoco
for $210 million. DPC intends that Venoco will use the cash
proceeds from the asset sale to repay borrowings under the existing
revolving credit facility and to make an offer to repurchase a
portion of the outstanding Venoco Senior Notes at par.
Additionally, DPC expects that Venoco will enter into a new first
lien revolving credit facility with an initial borrowing base of
$125 million and make a $31.0 million initial draw on that
facility.
All of the financing transactions, including Venoco's new credit
facility and term loan and its asset sale to DPC, would be
structured to close contemporaneously with the closing of the
merger contemplated by the Merger Agreement. Thus, the loan
transactions and asset sale would not occur unless the merger is
consummated.
Neither Venoco nor DPC has entered into definitive agreements
with respect to any aspect of the financing. Completion of the
financing is subject to finalization of terms, negotiation and
execution of definitive agreements, other customary conditions,
including satisfactory completion of due diligence by financing
sources, and, in the case of the asset sale described above,
approval by the independent members of Venoco's Board of Directors.
Accordingly, there can be no assurance that all or any of the
financing transactions, or the merger, will be completed within the
expected time period, on the terms contemplated, or at all.
A DPC presentation with updated details about its financing plan
has been posted on Venoco's website, www.venocoinc.com, on the
Investor Relations page under the Webcasts & Presentations
heading.
About the Company
Venoco is an independent energy company primarily engaged in the
acquisition, exploitation and development of oil and natural gas
properties primarily in California. Venoco operates three offshore
platforms in the Santa Barbara Channel, has non-operated interests
in three other platforms, operates several onshore properties in
Southern California, and has extensive operations in Northern
California's Sacramento Basin.
Forward-looking Statements
All statements in this press release except statements of
historical fact are forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934, and these statements are subject
to numerous risks and uncertainties. The closing of the merger
agreement with Mr. Marquez and his affiliates is subject to a
number of conditions, and those conditions may not be satisfied.
All forward-looking statements are made only as of the date hereof
and the company undertakes no obligation to update any such
statement. Further information on risks and uncertainties that may
affect the company's operations and financial performance, and the
forward-looking statements made herein, is available in the
company's filings with the Securities and Exchange Commission,
which are incorporated by this reference as though fully set forth
herein.
For further information, please contact Mike Edwards Vice
President (303) 626-8320 http://www.venocoinc.com E-Mail Email
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