Energy XXI Prices $271MM in Concurrent Offerings

Energy XXI announced the pricing of its previously announced concurrent offerings of $171 million (90 million shares) of its common stock and $100 million (1 million shares) of 7.25% convertible perpetual preferred stock. The company has also granted the underwriters a 30-day option to purchase up to 13.5 million additional shares of its common stock and 100,000 additional shares of its convertible preferred stock to cover over-allotments, if any. A further announcement will be issued should the over-allotment option be exercised. Both offerings are expected to settle and close on Dec. 14, 2009, each subject to customary closing conditions.

The common stock offering was priced at $1.90 per share. The company estimates that the net proceeds from the common stock offering will be approximately $162 million, after deducting underwriting commissions, but before expenses (or approximately $186.3 million, if the underwriters exercise their over-allotment option to purchase additional shares of common stock in full). The convertible preferred stock offering was priced at $100 per share. The company estimates that the net proceeds from the convertible preferred stock offering will be approximately $97 million, after deducting underwriting commissions, but before expenses (or approximately $106.7 million, if the underwriters exercise their over-allotment option to purchase additional shares of convertible preferred stock in full). As previously announced, the company will use the net proceeds from these offerings to fund its acquisition of certain Gulf of Mexico shelf oil and natural gas interests from MitEnergy Upstream LLC, a subsidiary of Mitsui & Co., Ltd.

UBS Investment Bank and Credit Suisse Securities (USA) LLC are serving as joint book-running managers for the offerings. The offerings are being made only by means of a prospectus and related prospectus supplements, copies of which may be obtained from UBS Investment Bank, Attention: Prospectus Department, 299 Park Avenue, New York, NY 10171, 888-827-7275 and Credit Suisse Securities (USA) LLC, Prospectus Department, One Madison Avenue, New York, NY 10010, 800-221-1037. An electronic copy of each of the prospectus supplements is available from the Securities and Exchange Commission's website at www.sec.gov.

The shares of common stock and convertible preferred stock are being offered pursuant to an effective shelf registration statement that the company previously filed with the U.S. Securities and Exchange Commission. This press release is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

The company will apply for the admission of the 90 million new shares to trading on AIM, a market operated by the London Stock Exchange, and such admission is expected to take place on Dec. 15, 2009.
 

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