Mariner Energy has priced its underwritten public offerings of common stock and senior notes.
Mariner has agreed to sell 10 million shares of common stock at a public offering price of $14.50 per share. The company granted the underwriters a 30-day option to purchase an additional 1.5 million shares of its common stock to cover over-allotments. Mariner estimates that its net proceeds from the sale of common stock, after deducting estimated underwriting discounts and commissions and offering expenses, will be $138.3 million, assuming the underwriters' over-allotment option is not exercised.
Mariner also has agreed to sell $300 million in aggregate principal amount of its 11.75% senior notes due 2016 concurrently with the sale of common stock, an increase of $50 million from the amount previously announced. The notes are expected to be sold at 97.093% of principal amount, for a yield to maturity of 12.375%. The notes will pay interest semi-annually in arrears and will mature on June 30, 2016, unless earlier repurchased. Mariner estimates that its net proceeds from the sale of notes, after deducting estimated underwriting discounts and commissions and offering expenses, will be $284.8 million.
Mariner expects to use net proceeds from the sales of common stock and senior notes to repay debt under its secured bank credit facility. Closing of the sales is expected on June 10, 2009, subject to customary closing conditions.
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