CES Energy Solutions Corp. confirmed the launch of a $75mn private placement of senior unsecured notes, adding to a previously issued $200mn tranche earlier this year. This new issuance will bring the total outstanding amount for this bond series to $275mn, with a maturity date set for May 24, 2029.
The notes will be issued at 103.125% of face value, offering a yield to worst of 5.559%. They will carry identical terms to the original issuance, except for the issue date, price, and initial interest accrual date. The notes will become fungible with the existing series following the expiry of the statutory holding period.
Support for liquidity and debt management
Net proceeds from the transaction will primarily be used to repay outstanding balances on the company’s senior syndicated credit facility and for general corporate purposes. The Calgary-based group aims to reinforce its capital structure and overall liquidity.
The transaction was led by a syndicate of financial institutions, with BMO Capital Markets and Scotiabank acting as joint active bookrunners. TD Securities also served as joint bookrunner, alongside co-leads ATB Capital Markets, National Bank Financial Markets, RBC Capital Markets, and Wells Fargo Securities Canada. CIBC Capital Markets, Peters & Co. Limited, and Raymond James participated as co-managers.
Limited legal framework for distribution
The notes will not be registered under the United States Securities Act of 1933 nor qualified for public sale under Canadian securities laws. As a result, they can only be offered or sold to qualified investors outside the United States in compliance with Canadian regulatory exemptions.
The company did not indicate whether additional issuances under this series may follow. This new financing step comes amid stable interest rates and a continued push by energy service companies to seek refinancing through private markets.
