MEG Energy Announces Pricing and Upsizing of its Offering of Senior Notes

CALGARY, Jan. 16, 2020 /CNW/ - MEG Energy Corp. today announced the pricing and an increase in the size of its previously announced offering (the "offering") of US$800 million in aggregate principal amount of senior unsecured notes (the "notes"). MEG is increasing the total size of the offering to US$1,200 million from US$800 million. The notes will bear interest at 7.125% per annum and are due in 2027.

MEG intends to use the net proceeds of the offering, together with cash on hand, (i) to refinance the Company's US$800 million in aggregate principal amount of 6.375% senior unsecured notes due January 2023 (the "2023 Notes") by way of a previously announced conditional redemption, (ii) to redeem US$400 million of its US$1,000 million aggregate principal amount of 7.00% senior unsecured notes due March 2024 (the "2024 Notes"), and (iii) to pay fees and expenses related to the offering.

MEG also announced that it has issued a conditional notice to redeem US$400 million of its US$1,000 million in aggregate principal amount of 2024 Notes at a redemption price of 102.333%, plus accrued and unpaid interest to, but not including, the redemption date. The redemption is expected to be completed on or about February 18, 2020 and is conditioned upon completion of the offering.

The closing of the offering, which is subject to customary conditions, is expected to occur on January 31, 2020.  The notes to be offered by MEG will not be registered under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act"), and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The notes are being offered only to qualified institutional buyers in the United States under Rule 144A and outside the United States in compliance with Regulation S under the U.S. Securities Act. In Canada, the notes are to be offered and sold on a private placement basis in certain provinces of Canada. This news release does not constitute an offer to sell, or a solicitation of an offer to buy, any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such an offer, solicitation, or sale would be unlawful.

Forward-Looking Information

Certain statements contained in this news release may constitute forward-looking statements within the meaning of applicable Canadian securities laws. These statements relate to future events or MEG's future performance. All statements other than statements of historical fact may be forward-looking statements. The use of any of the words "anticipate", "continue", "estimate", "expect", "may", "will", "project", "should", "believe", "dependent", "ability", "plan", "intend", "target", "potential" and similar expressions are intended to identify forward-looking statements. Forward-looking statements are often, but not always, identified by such words. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. In particular, and without limiting the foregoing, this news release contains forward-looking statements with respect to the proposed offering of notes, the use of proceeds therefrom, the timing and successful completion of the offering and the redemption of the 2023 Notes and the 2024 Notes. Such forward-looking information is based on certain assumptions and analysis made by MEG in light of its experience and perception of current conditions and expected future developments as well as other factors it believes are appropriate in the circumstances. However, whether actual results, performance or achievements will conform to MEG's expectations and predictions is subject to a number of known and unknown risks and uncertainties which could cause actual results to differ materially from MEG's expectations. Other factors which could materially affect such forward-looking information are described in the risk factors detailed in the offering documentation prepared and delivered by MEG in connection with the offering.

SOURCE MEG Energy Corp.