Selling $1-billion worth of assets wasn't enough. Cutting more costs won't be, either. So Penn West Petroleum Ltd. is pleading with its lenders to give it a bit of breathing room.
After signalling the need to rework its debt terms in March, the energy producer added some urgency to the request Monday, stressing that it likely won't meet its revised debt covenants by the end of June. Such restrictions were put in place last May when Penn West's credit facility was also cut by $500-million.
The warning comes despite a dramatic debt restructuring campaign over the past three years, during which the total value of Penn West's long-term debt dropped to $1.9-billion from $3.4-billion. The company has also cut operating costs on its remaining assets by 20 per cent since 2013, and expects to be able to slash another 20 per cent on the same assets.
But the implicit message now is that isn't enough, which is why the company needs to rework its covenants. Story
Patrick Meneley's 2016 so far
If you had bumped into Patrick Meneley early in the year, he might have preferred you not ask him about business.
"The first six weeks were dead," Mr. Meneley, TD Securities Inc.'s head of global corporate and investment banking, said in an interview. "January was the slowest month I've ever seen in the business – including the financial crisis."
Mr. Meneley has been an investment banker for almost 30 years and the head banker at TD since 2001. He seems as befuddled as anyone that 2016 pivoted mid-February, considering the dire fashion in which the year began.
Since then, a wave of secondary financings have hit the market – a few of the really big ones in the pipelines and utilities sector with one even setting a record along the way. Story
DAILY DEALS
Eldorado Gold Corp. has reached agreement to sell its stakes in two mines and one development project in China to Yintai Resources Co. Ltd. for $600-million in cash. Story
Connacher Oil and Gas Ltd. said it intends to file for creditor protection, becoming the latest casualty of the energy bust. Story
Toronto housing developer Urbancorp is pushing ahead with a corporate restructuring under creditor protection. Story
Fairfax Financial Holdings Ltd. is in advanced talks to buy control of Indonesian financial group PT Paninvest's non-life insurance unit, Bloomberg reported. Story
Schroders Plc is acquiring a team from Brookfield Investment Management. Story
Pfizer Inc. is buying Anacor Pharmaceuticals Inc. in a $5.2-billion (U.S.) deal to add an eczema gel to its portfolio, a month after the U.S. drug major scrapped plans to buy Allergan Plc. Story
Finland's Konecranes has agreed to buy Terex Corp.'s cranes business for ports and factories for $1.3-billion, in a move that cancels a planned full merger and allows the U.S. firm to pursue talks with a rival suitor. Story
Gannett Co. Inc. raised its unsolicited offer for Tribune Publishing Co. Story
ON THE MOVE
There is more management change under way at Telus Corp., with chief financial officer John Gossling set to depart by the end of the month and make room on the executive team for another veteran of the company.
The Vancouver-based telecommunications provider said Monday that Doug French, a 20-year Telus employee who has worked in a number of senior roles over the years – most recently as corporate controller – is taking over as CFO immediately. Story
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