Range Resources Corp. amended and more than doubled its credit facility alongside the acquisition of the 50% of Great Lakes Energy Partners that it previously did not own. Range's borrowing-base revolver was increased from $240 million to $500 million. The bank line was increased as part of the overall acquisition financing, which also included approximately $149 million of equity and $100 million in high-yield bonds, noted Roger Manny, Range's cfo. Great Lakes was formed in 1999 to hold Appalachian oil and gas properties.
The amended credit took out an existing facility at the Great Lakes level and simplified the credit structure. "We took the restructuring as an opportunity to extend the maturity a year, reprice the advances and streamline the covenant structure," Manny said. He declined to comment on the spread but said, "It's a more creditworthy company following the transaction than it was before and that fact is reflected in both the pricing and the structure."
Bank One is the lead arranger and administrative agent on the credit and was the admin agent on both the original credit facility and on the facility that existed at the Great Lakes venture. "We look for a longstanding relationship of consistent credit support and superior service and Bank One fulfills both of those requirements," Manny said. J.P. Morgan had been a top-tier lender in the credit prior to the merger with Bank One, Manny noted. Some additional banks were added to the credit to redistribute the exposure, he added. There are a total of 16 banks in the transaction. Fortis Capital and Fleet National Bank, now Bank of America, are co-documentation agents on the credit. Calyon and Harris Nesbitt are co-syndication agents.