Latham & Watkins Represented SM Energy on Complex Liability Management Transactions

Latham & Watkins advised SM Energy Company, an independent energy company engaged in the acquisition, exploration, development, and production of crude oil, natural gas, and NGLs, in its offers to exchange (the Exchange Offers) its outstanding high-yield notes (the Old Notes) for newly issued 10.00% senior secured notes due 2025 (the New Notes). 

In conjunction with the Exchange Offers, SM Energy also entered into an agreement with certain noteholders to enter into a private exchange (the Private Exchange) of their Old Notes and 1.5% Convertible Notes due 2021 (the Old Convertible Notes) for New Notes, warrants to purchase common stock, and cash.

In the Exchange Offers and the Private Exchange together, the company exchanged approximately US$612 million aggregate principal amount of Old Notes and approximately US$107 million aggregate principal amount of Old Convertible Notes and issued approximately US$447 million in aggregate principal amount of New Notes on June 17, 2020. SM Energy reduced its outstanding senior debt by approximately US$272 million.

Latham & Watkins LLP represented SM Energy in the transactions with a corporate team led by Houston partners David Miller and Trevor Lavelle with Washington, D.C. associate Samuel Rettew and Houston associates Om Pandya, Danny Shulman and Danielle Kinchen. Advice was also provided on tax matters by Houston partners Tim Fenn and Jim Cole; and on finance matters by Houston associates Benjamin Gelfand and Rosey Jamail.