Energy Producer Explores Swaps Market

  • 26 Aug 2002
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Newfield Exploration Co., an oil and gas producer with annual revenue of roughly USD700 million, may enter its first interest rate swap after it completes its pending acquisition of EEX Corp. Terry Rathert, cfo in Houston, said any swap would convert a portion of a recent fixed-rate USD250 million bond offering it sold earlier this month into a floating-rate obligation.

The funds raised from the bond deal are being held in escrow to partially finance the USD640 million acquisition of EEX, which closes next month, and a decision on whether the combined company will enter its debut swap will be made afterwards.

The oil and gas explorer has not entered swaps before because its USD376 million of outstanding debt was evenly balanced between fixed and floating. However, the company has recently had strong cash flows, which has meant it has not had to use floating-rate bank loans but issued the fixed-rate bond, the result of which is a predominately fixed-rate debt portfolio. Rathert said it may still take out a loan to finance some of the EEX purchase.

Rathert said he has not studied the cost implications of entering a swap and is instead focusing on the acquisition. He noted that any move to convert the 8.375% seven-year bond into a synthetic floater would essentially constitute a punt on the markets, and as a result he wants to perform adequate due diligence before making a decision either way. "What happens between now and then is something we will be watching closely, when we get a little closer we can spend some time focusing on the economics of the swap," he told DW.

UBS Warburg and JPMorgan led the bond sale, but Rathert said any fixed-income derivatives business would be awarded to a wider group of firms based on their sophistication. He added, UBS and JPMorgan would not receive special treatment.

Moody's Investors Service rates Newfield Baa3 and Standard & Poor's rates it BB minus.

  • 26 Aug 2002

All International Bonds

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 17 Oct 2016
1 JPMorgan 310,048.18 1328 8.75%
2 Citi 285,934.48 1059 8.07%
3 Barclays 258,057.88 833 7.29%
4 Bank of America Merrill Lynch 248,459.06 911 7.01%
5 HSBC 218,245.86 884 6.16%

Bookrunners of All Syndicated Loans EMEA

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 18 Oct 2016
1 JPMorgan 29,669.98 55 6.95%
2 UniCredit 28,692.62 136 6.73%
3 BNP Paribas 28,431.90 139 6.66%
4 HSBC 22,935.49 112 5.38%
5 ING 18,645.88 118 4.37%

Bookrunners of all EMEA ECM Issuance

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 18 Oct 2016
1 JPMorgan 14,593.71 79 10.38%
2 Goldman Sachs 11,713.19 63 8.33%
3 Morgan Stanley 9,435.23 48 6.71%
4 Bank of America Merrill Lynch 9,019.27 40 6.41%
5 UBS 8,763.73 42 6.23%