18 June 2020capital raising announcement● NeutralMajor
On June 17, 2020, SM Energy closed its debt exchange, swapping $718.9 million of older notes (including $107.0 million of 2021 convertible notes) for $446.675 million of new 10% second-lien secured notes due January 15, 2025. It also issued warrants to the participating holders to buy up to 5% of its common stock (subject to conditions) and paid about $53.5 million in cash to those who exchanged the 2021 notes. This completes the distressed exchange begun after the April 2020 oil price crash; it cuts the principal of the older debt but puts the new notes ahead of unsecured debt and adds potential share dilution through the warrants.