Each one in plain English, with the numbers worked through for a shareholder.
21 Aug 2014business combination▼ BadMajor
On August 20, 2014 Magnum Hunter filed a supplementary Bidder's Statement for Ambassador, which the filing says the Takeovers Panel required as corrective disclosure. It values the offer at A$0.278 per Ambassador share (Magnum Hunter at US$6.06 on Aug 14, versus A$0.38 when raised in June), says ASIC refused relief for the cash share sale facility as proposed, gives Ambassador holders who already accepted a withdrawal right until Sept 3, and restates the auditor history, including three remaining material weaknesses in internal controls at Dec 31, 2013 (down from fourteen at Dec 31, 2012).
On August 13, 2014 Magnum Hunter said it had no present intention to raise its Ambassador offer or extend it past August 22 (it reserved the right to do either). It said the key reason for the bid weakened after South Australia's regulator suspended work commitments on the PEL 570 Cooper Basin permit for six months and pushed a seismic survey back 18 months to March 2016. This marks a cooling of the bid that began in June, and the filing says an increase would be unattractive to Magnum Hunter's existing stockholders.
On July 29, 2014 Magnum Hunter said Australia's Takeovers Panel ruled in its favour, declaring unacceptable circumstances against rival bidder Drillsearch, Ambassador's directors and certain shareholders. Holders of more than 54% of Ambassador shares who had accepted Drillsearch's offer had their acceptances reversed or can withdraw them and accept Magnum Hunter's 1-for-23.6 offer. This resolves the Takeovers Panel complaint raised in June, though the bid itself is still undecided.
On July 18, 2014 Magnum Hunter's Australian subsidiary extended the Ambassador offer so it now closes on August 22, 2014 instead of July 23, unless extended again. The terms are unchanged in this notice, and the bid remains open.
26 June 2014capital raising announcement● NeutralMajor
Magnum Hunter formally launched its all-stock takeover offer for ASX-listed Ambassador Oil and Gas, offering one Magnum Hunter share for every 23.6 Ambassador shares (implying about $49.7 million total) - an unusual bet on Australian exploration acreage layered on top of an otherwise US-focused, deleveraging strategy.
On June 20, 2014 Magnum Hunter filed the formal Bidder's Statement for its Ambassador offer, made through a wholly owned Australian subsidiary, Outback Shale Hunter Pty Ltd. It is an unconditional offer of 1 Magnum Hunter share for every 23.6 Ambassador shares, opening June 23 and closing July 23, 2014 unless extended. This is the Bidder's Statement the earlier open thread was waiting for; the filing text shown is truncated, so further terms are not covered here.
On June 17, 2014 Magnum Hunter raised its offer for Ambassador Oil and Gas to 1 Magnum Hunter share for every 23.6 Ambassador shares (about A$0.38 per share, up from 1 for 27.8), and declared the offer unconditional. It also announced a share sale facility for Ambassador holders who want cash, and said it would apply to Australia's Takeovers Panel over Ambassador holders (about 26.43%, plus two directors) accepting the rival Drillsearch offer. This continues the June 10 bid; the higher ratio means more Magnum Hunter shares would be issued than the ~5.1M first stated.
On June 10, 2014 Magnum Hunter announced its intention to make a conditional takeover offer for Australia's Ambassador Oil and Gas, paying one Magnum Hunter share for every 27.8 Ambassador shares (about A$0.34 per share, which the filing says is 20% above a rival Drillsearch offer). It would issue about 5.1 million shares, roughly 2.6% of its outstanding stock, and the CEO says no cash spending is budgeted in Australia for 2014. It builds on Magnum Hunter's existing stake in New Standard Energy, Ambassador's partner in the Cooper Basin, which it received in the January 2014 sale of Eagle Ford properties.
Magnum Hunter's bank lenders consented to let it pursue an all-stock takeover bid for Ambassador Oil and Gas, an Australian company, through a new unrestricted foreign subsidiary - a surprising international expansion even as the company kept selling off North American assets in Canada and North Dakota to focus its balance sheet.
30 May 2014capital raising announcement▲ GoodMajor
Magnum Hunter raised $150 million in a private placement of stock and warrants to activist investor Relational Investors, earmarked for accelerating Marcellus/Utica drilling in Ohio and West Virginia, buying more leasehold there, and paying down its revolving credit facility - a large new institutional shareholder brought in as the company doubled down on Appalachia.
Magnum Hunter filed the pro forma financials for the closed Williston Hunter Canada/Steppe Resources sale, bundled with an earlier, smaller sale of Alberta assets to BDJ Energy - paperwork closing out the Canadian divestiture.
Magnum Hunter reported encouraging early results from its first Utica Shale well in West Virginia (Stewart Winland pad, Tyler County), with wireline logs showing hydrocarbon-bearing rock consistent with its earlier Stalder Utica discovery in Ohio - the Appalachian Utica/Marcellus push it was now funding was starting to show technical results.
Magnum Hunter closed the sale of Williston Hunter Canada (the former NuLoch Saskatchewan assets) to Steppe Resources for CAD $75 million cash, completing its exit from Canada three years after the NuLoch acquisition first brought it there.
Magnum Hunter agreed to sell its Canadian subsidiary Williston Hunter Canada - the Tableland Field oil properties in Saskatchewan it had gained through the 2011 NuLoch acquisition - to Steppe Resources for about CAD $75 million (about US $68 million) cash, another step in exiting non-core assets to focus on its Appalachian core.
Eureka Hunter Pipeline refinanced into a new $117 million ABN AMRO-led revolving facility (extendable to $150 million only with lender consent), non-recourse to Magnum Hunter, using it to repay and cancel the $50 million PennantPark second-lien term loan that had needed covenant relief in 2012 and again in 2013, and to close out the undrawn SunTrust first lien. The same filing disclosed the sale of Magnum Hunter's Alberta properties - about 110 boe/day from three Kiskatinaw wells - to BDJ Energy for CAD $9.5 million.
Magnum Hunter raised $30.1 million in a private placement of 4.3 million common shares to institutional investors, earmarked for its Marcellus/Utica Ohio and West Virginia leasehold buildout and related gas-transportation letters of credit - funding the Appalachian growth even as it kept selling off North Dakota, Eagle Ford and Canadian assets.
What it means for a shareholder
4.3m new shares at about $7.00 to raise about $30.1m. That's 2.4% dilution: every existing holder's slice gets 2.4% smaller. If you held $1,000 of shares (143 at the issue price), your slice goes from 0.0000833% to 0.0000813% of the company. To keep it you'd need 4 more shares - about $28 at the issue price.
New Standard Energy's Texas subsidiary exercised its option and signed to buy Magnum Hunter's remaining Eagle Ford Shale properties for $15 million cash plus NSE shares, completing Magnum Hunter's full exit from the Eagle Ford play first entered years earlier.
Magnum Hunter settled a tangle of lawsuits and an arbitration with Seminole Energy Services over a jointly-owned Tennessee gas processing plant and related contracts - the same counterparty whose gas-gathering fee agreements Magnum Hunter had negotiated cooperatively back in 2011 as a condition of the NGAS merger had since escalated into multi-state litigation, now resolved by settlement.
Magnum Hunter closed the sale of its Burke/Renville/Bottineau/McHenry County, North Dakota properties to Enduro Operating for about $39.6 million net of the earlier deposit, and its credit facility borrowing base automatically dropped by $22.5 million as a result - continuing the wind-down of the North Dakota position built up through 2012's big acquisitions.
Magnum Hunter replaced its long-running, many-times-amended bank facility with a fresh Third Amended and Restated Credit Agreement, still with Bank of Montreal, on largely similar terms and a $265 million starting borrowing base - a clean reset after eighteen amendments piled onto the old agreement since 2011.
Magnum Hunter granted Australia's Pathfinder Onshore Energy (a New Standard Energy subsidiary) an option to buy its remaining Eagle Ford Shale properties in Atascosa County, Texas for $15 million cash plus New Standard Energy shares - completing Magnum Hunter's exit from the Eagle Ford play it had entered years earlier and now sold off entirely following the larger Penn Virginia sale.
Magnum Hunter agreed to sell more North Dakota oil and gas properties - about 30,000 acres and 180 wells across four counties - to Enduro Operating for $45 million cash, continuing to shed North Dakota acreage acquired just eighteen months earlier in the big Baytex deal.
Magnum Hunter finalized the terms of the warrants issued as the August 2013 dividend - exercisable at $8.50/share from September 2014 (or once a registration statement is effective) through April 2016 - formalizing the arrangement announced weeks earlier.
Amendment No. 2 to the $600 million 9.750% senior notes exchange registration statement (dated Oct 2, 2013). The exchange terms are unchanged; the prospectus is reorganised, with risk factors and the business, financial and management sections now in a single document. The expiry date is still blank, so the exchange offer has not yet been launched.
Amendment No. 1 to the notes exchange registration statement. It fixes a technical EDGAR problem that kept the original filing from being filed for the subsidiary guarantors, updates the 'Recent Developments' section and adds some exhibits. The $600 million 9.750% notes exchange itself is unchanged.
Magnum Hunter's Williston Hunter subsidiary agreed to sell a small non-operated North Dakota working interest (about 14,500 net acres, 120 boe/d) to Oasis Petroleum for $32.5 million cash - continued portfolio pruning of North Dakota assets even as it kept a larger Bakken/Williston core.
Magnum Hunter filed a new registration statement (dated Aug 30, 2013) to swap its $600 million of 9.750% senior notes due 2020 (the $450M issued May 16, 2012 and the $150M add-on issued Dec 18, 2012) for identical notes registered with the SEC. This replaces the January 2013 S-4, which the filing says was withdrawn, and its $81,840 fee is carried over. The exchange changes registration status, not the terms of the debt, and no minimum tender is required.
Magnum Hunter declared another warrant dividend to common shareholders - one warrant per ten shares, exercisable at $8.50 through April 2016 - its second such warrant dividend after the 2011 one, again a shareholder sweetener rather than a cash payout.
Magnum Hunter's bank lenders eased its credit-agreement leverage covenants - deferring the total-debt-to-EBITDAX test to mid-2014 and softening interest-coverage requirements - while also allowing further cash investment in the Eureka Hunter midstream subsidiary, a sign the company needed covenant relief to keep its debt load in compliance.
Triad Hunter agreed to acquire up to 32,000 net mineral acres in Monroe, Noble and Washington Counties, Ohio from a landowner association (MNW Energy) through a phased, multi-closing structure over roughly the next 10 months - continued Appalachian leasehold growth even as the company was also divesting Eagle Ford and North Dakota assets.
