New Enquest Retail Bond 9% Due 2027

[sackofspuds]

As I mentioned before, I expect the 9s to trade around 115%. Any bets?
V8

I reckon less than a 15% premium. ENQ1 is at at a 1% premium but its nominal yield is 2% lower.

So my bet is 103%.

[hiriskpaul]

As I mentioned before, I expect the 9s to trade around 115%. Any bets?
V8

I reckon less than a 15% premium. ENQ1 is at at a 1% premium but its nominal yield is 2% lower.

So my bet is 103%.

ENQ1 trades dirty. Strip out the accrued and it does not really trade at a premium. It also matures in 18 months and is callable at par, both of which will likely keep the price close to par provided the refinancing is successful.

So overall I don't think you can read much into the secondary market price of the 9%. Having said that, I hope V8 is right!

[sackofspuds]

ENQ1 trades dirty.

Ah. I still don't think we will see a 15% premium, even though it would be great.

As I said previously, ENQ1 has only traded above par a couple of times in the last 5 years and that's only in the last year with oil prices at $100 or more.

I don't see any mad rush to buy these once they start trading.

I'll stick with my 3% premium.

[Laughton]

Exchange Off Corporate Action finally up on HL.

They only give a deadline of midday on April 14 - so less than a week which is a poor show given many will be away for the Easter break (at least according to national media coverage).

[hiriskpaul]

Exchange Off Corporate Action finally up on HL.

They only give a deadline of midday on April 14 - so less than a week which is a poor show given many will be away for the Easter break (at least according to national media coverage).

Yes, only 6 days away. I was hoping to leave my decision a bit longer than that. I am now leaning towards converting the lot, but will decide next week.

[Holts]

Interactive Investor won't let you trade ENQ1 online, you have to call.

They seem capricious in deciding what they will and will not trade online.
Can't trade SKIP, STAC for example, or even NWBD which seems quite bonkers.

You can do NWBD with II , not SKIP , have got STAC but have not tried buying more with them , there does seem to be inconsistently , SKIP is more to do with settlement.

[88V8]

All 254 pages of the prospectus are available here [url]https://www.enquest.com/investors/corporate-actions/retail-
The issue is open-ended, so we should get a full allocation.

But, on page 17 of the offer it says The total principle amount of the Notes to be issued will be specified...
so it was not correct for me to say that there will be no scaling.
Both the 9s and the exchange offer may be scaled back.

I proffered all my 7s, and tried to buy some more this afternoon but twice got cut off. Well, it is Friday.
Try again next week.

Interactive Investor won't let you trade ENQ1 online, you have to call.

They seem capricious in deciding what they will and will not trade online.
Can't trade SKIP, STAC for example, or even NWBD which seems quite bonkers.

You can do NWBD with II , not SKIP , have got STAC but have not tried buying more with them , there does seem to be inconsistently , SKIP is more to do with settlement.

I fancy that one can sell NWBD but not buy them, at least that was the case last time I tried.
What's with SKIP, I mean it's northern, but do they settle in groats?

V8

[Gan020]

I have exchanged all mine. I'm happy with the coupon. Unlike most of the opportunities we have seen over the last 2 years I consider this one fairly priced.

I am guessing that it's very unlikely the exchange offer will be scaled back. If this was the intention this would have been stated in the prospectus at the beginning. Also, they wouldn't be offering a 1.5% fee to convert, it would be something more like 0.5%

[geoffp]

gan020,
Agree with your thoughts. The way I read it is that after accepting all the bonds offered for exchange then a decision will be taken about how much of the new applications will be accepted. The only reference to 'scaling back' that I could find is on page 21 when, referring to new investors the document says "You may not be allocated all (or any) of the Notes for which you apply." There is no similar comment made about existing investors offering bonds for exchange.

[spasmodicus]

I recently topped up my ENQ1s in HL at 101.354p (5k units). HL did not specifically flag the exchange offer for the 9%, for which I notice that the expiry date is 4:00 p.m. London time on 20 April 2022. HL put a deadline of 14th April for doing this and wrote Full details of this event will be sent to Qualifying Hargreaves Lansdown clients by either post or secure message. Please note that any instruction you give must be based on the full details provided in the letter and not on the summary information outlined above.. Well, sorreee they haven't notified me either by post or message.

Despite high inflation, better offers than this are few and far between and, for example, LLPC has dropped in price to around 155p recently so that its yield stabilised at about 6% over the last month or so, which might serve as some kind of benchmark. The Enquest offering carries 2 main risks imo, 1) that the oil price might drop substantially which I think is unlikely at least in the short term and 2) the "small oily" risk alluded to earlier in the thread, which was what arguably caused them to drop to below 40p in early 2020. I'm preparing to hold them at par, plus or minus a couple of percent maybe for a year or so until we see how things pan out.
S

[sackofspuds]

It's the fact that the broker may be remiss in letting you tender ENQ1 that I see as the downside of buying ENQ1 now.

[spasmodicus]

correction, HL had emailed me yesterday to say that I had a new secure message, although it did not appear in my account when I logged in this morning. Now it is there, so I elected to exchange my holding. They also say "An exchange fee of 1.5p will be paid to noteholders for every £1 of notes exchanged" so that the new ones I bought will effectively be at close to par.
S

[Holts]

I fancy that one can sell NWBD but not buy them, at least that was the case last time I tried.
What's with SKIP, I mean it's northern, but do they settle in groats?

V8[/quote]

I have bought Nwbd online with II recently , SKIP had a problem with settlement , I wrote to their Treasury and they did get them fully into Crest and for a while with EQI you could trade online but there was still a problem with settlement and they got withdrawn again . Groats seems about right !

[Wozzitworthit]

Well, we have just offered all of ours up for exchange.

I hope the premium is 115%, obviously, but, just to enter the sweep stake, i think it will be around 102 +/- 0.5 !

Woz

[Gwm24]

I agree with your pricing Wozzit. I suspect that these bonds won't be around in 5 years. Think they are trying to avoid a cliff edge scenario that Premier Oil faced. If oil prices stay high I'm sure they'll be looking to redeem these at the earliest opportunity. In the meantime it works for me and have offered all mine for exchange as well. Will make a decision in due course about when to sell them.

[88V8]

Well that was a faff... bought some more PIKs this afternoon to tender them... phone only at ii but charged the online fee.... the bonds didn't appear in my account.
After 45 minutes, still nothing.

Then I noticed that the election deadline at ii is today.
So I phone.
Eventually put through to a dealer.
Who calls someone in Contracts.
And while we're still speaking and he's telling me that he hopes it will be done today, they appear.
But no Corp Action tick so I can't do the election.
So now the dealer - helpful chap - has to make the election for me, manually.
40 minutes on the phone.

The takeaway... things may happen less quickly with a telephone trade.

Fingers crossed now.

V8

[Gwm24]

What a pain for you 88v8. II are great for bog standard dealing but a nightmare for anything unusual. Idealing election is until 17/4!

[hiriskpaul]

Offered all of ours for exchange.

[Wozzitworthit]

Sizing Announcement and Announcement of Results of Exchange Offer


https://www.londonstockexchange.com/new ... t/15418612

Hmmm......

[hiriskpaul]

Sizing Announcement and Announcement of Results of Exchange Offer


https://www.londonstockexchange.com/new ... t/15418612

Hmmm......

Not exactly an overwhelming endorsement. It will be interesting to see what Enquest do next. They have not raised sufficient new money to pay off holdouts of the existing notes due next year.