Thursday, February 17, 2011

Callon Petroleum Company Announces Partial Redemption of 13% Senior Notes Due 2016

Our long road with Callon Petroleum is drawing to a close. The company will be partially redeeming the 13% Senior Notes Due 2016:

Callon Petroleum Company today announced it is redeeming $31.0 million of its outstanding $138.0 million 13% Senior Notes due 2016 with a portion of the proceeds from its previously announced common stock offering which was completed yesterday. The redemption will be made in accordance with the terms of the indenture governing the Notes.

Callon expects to redeem the Notes on March 19, 2011 at a redemption price of 113.0% of their principal amount, plus accrued and unpaid interest to the Redemption Date.
It has been a pleasant journey so far. I wrote a post about these notes back in August of last year when they were trading in the 90s. Getting taken out at 113 is a great IRR!

The company is actually not allowed (per the terms of the note indenture) to call any more bonds than this. I'm sure they would redeem more of them if they could.

9 comments:

getyourselfconnected said...

Nice call on that!

Don't get silver bugs ( I am one) rolling on a nice day like today, via a previous post. LOL.

CP said...

Ha!

Can't you think of a better inflation hedge than silver?

I'll give you a hint: it's not natural gas either...

getyourselfconnected said...

Well I am out of guesses. I wonder why fleeing dictators as of late dont send off with a tanker of LNP instead of gold or silver bullion though.

CP said...

Yeah, the only assets worth buying are ones that are easy to steal and hide, right? Forget cash flows...

No guess? Another hint - it does involve commodities.

getyourselfconnected said...

No idea, now I am bemused. Please don't be a digital anything. LOL

CP said...

I'm working on a post about it.

Another hint: One hundred percent tangible and the United States government guarantees that you can't lose money.

The silver bugs will be apoplectic.

getyourselfconnected said...

If you say TIPS I am out of here. Dollars, you cant lose money but you may have noticed you can lose buying power.

CP said...

Not TIPS! Remember - no paper is involved.

Did I mention you could take possession of this asset and store it?

It has downside protection 100% guaranteed by the U.S. government. They have officially written a put option on it.

CP said...

Keep trying! - when I announce it you may want to get your self connected to some.