Antero Resources (AR) Update - May 19

[dan_s]

Antero continues to restructure their debt, which is lowering their interest rate and extending maturity dates. This is good news.

Antero Resources Corporation AR announced that it has priced its upsized $600 million of senior notes. The offering of the notes, to eligible customers in a private placement, is likely to get completed on Jun 1, 2021.

The aggregate principal amount of the senior unsecured notes is expected to carry an interest rate of 5.375% and will mature by 2030. Notably, the upstream energy player has priced the upsized notes at par. Following the deduction of estimated expenses and discounts of the initial purchasers, the company expects to receive net proceeds of roughly $593 million from the notes offerings.

Antero Resources added that it plans to utilize the net proceeds for financing the redemption of its senior notes, carrying 5.625% interest rate and scheduled to mature in 2023. The company expressed intentions of allocating the remaining proceeds toward repaying borrowing under its credit facility.
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The NYMEX futures strip for natural gas and rising NGL prices combined with a much stronger balance sheet make it impossible for me to find any reason that AR should still be trading below book value. Based on their March 31, 2021 balance sheet AR's book value is $20.62/share. At the time of this post, AR is trading for $12.88.