Teekay Corporation Announces Proposed $300 Million Private Offering of Senior Secured Notes; and Eliminates Dividend
April 24 2019 - 7:33AM
Teekay Corporation (Teekay or the Company) (NYSE:TK) announced
today that, subject to market conditions, it intends to offer $300
million in aggregate principal amount of senior secured notes due
2024 (the Notes) in a private placement to eligible purchasers
under Rule 144A and Regulation S of the U.S. Securities Act of
1933, as amended (the Securities Act). It is expected that the
Notes will be guaranteed on a senior secured basis by certain of
Teekay’s subsidiaries and initially be secured by first-priority
liens on two of Teekay’s floating production, storage and
offloading (FPSO) units, a pledge of the equity interests of the
Teekay subsidiary that owns all of Teekay’s common units of Teekay
LNG Partners L.P. and Teekay Offshore Partners L.P. and all of
Teekay’s Class A common shares of Teekay Tankers Ltd., and a pledge
of the equity interests in the Teekay subsidiaries that own two of
its FPSO units.
Teekay expects to use the net proceeds from the
Notes offering to partially fund the tender offer, also announced
today, to purchase any and all of its outstanding 8.5% Senior Notes
due 2020 (the 2020 Notes) and any fees and expenses thereof. The
remainder of the tender offer is expected to be funded with a
portion of Teekay’s available existing cash and borrowings under
its equity margin loan facility. The proposed Notes offering is
conditioned upon the receipt of consents of at least a majority of
the aggregate principal amount of the outstanding 2020 Notes and
the effectiveness of certain proposed amendments (the Proposed
Amendments) to the indenture governing the 2020 Notes (which will
eliminate substantially all of the restrictive covenants and
certain events of default and related provisions).
The Notes to be offered will not be registered
under the Securities Act, or any state securities laws, and may not
be offered or sold in the United States absent registration or an
applicable exemption from registration requirements of the
Securities Act and applicable state securities laws. The Notes are
being offered and sold only to persons reasonably believed to be
qualified institutional buyers in the United States pursuant to
Rule 144A under the Securities Act and to certain non-U.S. persons
outside the United States in compliance with Regulation S under the
Securities Act.
This news release does not constitute an offer
to sell or a solicitation of an offer to buy the securities
described herein, nor shall there be any sale of these securities
in any state or jurisdiction in which such an offer, solicitation
or sale would be unlawful prior to registration or qualification
under the securities laws of any such jurisdiction.
Dividend Update
In connection with this Notes offering and the
tender offer for the 2020 Notes, Teekay’s Board of Directors has
approved the elimination of the quarterly dividend on Teekay’s
common stock commencing with the quarter ended March 31, 2019,
which is in-line with the Company’s strategy to further strengthen
its balance sheet.
About Teekay
Teekay is a leading provider of international
crude oil and gas marine transportation services and offshore
production and logistics. Teekay provides these services primarily
through its directly-owned fleet and its controlling ownership
interests in Teekay LNG Partners L.P. (NYSE:TGP), the world’s third
largest independent owner and operator of LNG carriers, and Teekay
Tankers Ltd. (NYSE:TNK), one of the world’s largest owners and
operators of mid-sized crude tankers, and its non-controlling
interests in Teekay Offshore Partners L.P. (NYSE:TOO), the world’s
largest provider of shuttle tankers and fourth largest independent
provider of leased FPSO solutions. The combined Teekay entities
manage and operate total assets under management of approximately
$16 billion, comprised of 205 liquefied gas, offshore, and
conventional tanker assets. With offices in 14 countries and
approximately 8,000 seagoing and shore-based employees, Teekay
provides a comprehensive set of marine services to the world’s
leading oil and gas companies.
Teekay’s common stock trades on the New York
Stock Exchange under the symbol “TK”.
For Investor
Relationsenquiries contact:
Ryan HamiltonTel: +1 (604) 609-2963Website:
www.teekay.com
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