UBS, Credit Suisse and Citigroup last week launched syndication of a 364-day, $24 billion senior unsecured credit facility for Anadarko Petroleum Co. The facility will finance the $21.1 billion acquisition of Western Gas Resources and Kerr-McGee Corp. by Anadarko, and pay off $2.2 billion of debt. Pricing is based on credit ratings, ranging from five basis points to 80 basis points.
W&T Offshore merged with Kerr-McGee's Gulf of Mexico oil and gas reserves back in May, with a $1.3 billion facility led by Toronto Dominion and Lehman Brothers (CIN, 5/12). A $5 billion deal for Kerr-McGee led by JPMorgan and Lehman nearly went sour back in 2005, when investors complained that the facility was priced too cheaply. Pricing was eventually increased (LMW, 4/22/05).
Western Gas is an exploration and production and a midstream company based in Denver, with a majority of operations in the Rocky Mountains. It has total proved reserves of 153 million barrels of oil equivalent. Kerr-McGee is an independent E&P company based in Oklahoma City, with operations in the Rocky Mountains and the Gulf of Mexico, and total proved reserves of approximately 900 million barrels of oil equivalent at the end of 2005.
Pro forma for the acquisitions, Anadarko is the largest independent E&P company in the world. Calls to Al Walker, cfo, were referred to public affairs, where a representative declined to comment. Calls to Bob Wohleber, cfo of Kerr-McGee, were not returned. Calls to Bill Krysiak, cfo of Western Gas, were referred to investor relations; a spokesman referred questions to a Securities and Exchange Commission proxy filing.