Corral Petroleum Holdings AB (publ) Announces the Expiration of its Exchange Offer and Consent Solicitation and Acceptance for Exchange of 98.88% of Outstanding Notes

Not For Distribution in Canada, Japan or Australia

Sep 12, 2011, 05:31 ET from Corral Petroleum Holdings AB

LONDON, September 12, 2011 /PRNewswire/ --

Corral Petroleum Holdings AB (publ) ("Corral Petroleum Holdings") announced today that it has accepted for exchange 98.88% of its euro Varying Rate Senior Secured Notes due 2011 (ISIN Nos. XS0505387372 and XS0505387539) and of its dollar Varying Rate Senior Secured Notes due 2011 (ISIN Nos. USW22545AC68 and US22025LAC28) (collectively, the "Existing Notes") pursuant to its previously announced exchange offer and consent solicitation launched on August 11, 2011 (the "Exchange Offer and Consent Solicitation"), which expired at 10:00 p.m., London (UK) local time, 5:00 p.m., New York City (USA) local time, on Friday, September 9, 2011.

The closing for the Exchange Offer and Consent Solicitation is expected to occur on Wednesday, September 14, 2011 (the "Closing Date"), at which time the Existing Notes tendered will be exchanged for a combination of cash of $300 million (the "Cash Consideration") and new euro- and dollar-denominated 15% Senior Notes due 2017 (the "New Notes"), as described in the exchange offer memorandum and consent solicitation statement dated August 11, 2011 (the "Exchange Offer Memorandum and Consent Solicitation Statement"). As the total principal amount of Existing Notes (including accrued and unpaid interest up to but not including the Closing Date) tendered for cash is greater than the Cash Consideration, all of the Existing Notes (including accrued and unpaid interest up to but not including the Closing Date)  tendered for cash have been subject to a proration factor of 54.4296%, except for Existing Notes which upon exchange do not meet the minimum denomination requirements for the New Notes, which will be exchanged solely for cash.  As a result, holders of Existing Notes who have participated in the Exchange Offer and Consent Solicitation will receive, in the aggregate, approximately €136 million in original principal amount of 15% Senior Euro Notes due 2017 and approximately $169 million in original principal amount of 15% Senior Dollar Notes due 2017, together with $300 million of Cash Consideration.  This aggregate consideration includes the consent premium, which consists of New Notes equal to 3.5% of the principal amount of Existing Notes  (including accrued and unpaid interest up to but not including the Closing Date) tendered and exchanged for New Notes before the early consent deadline on September 2, 2011 (the "Early Consent Deadline").  In addition, holders will receive the early lock-up fee payable in cash equal to 1% of the principal amount of Existing Notes (including accrued and unpaid interest up to but not including the Closing Date) tendered prior to the Early Consent Deadline.

For purposes of determining the amounts described above, Corral Petroleum Holdings has set a record date of September 12, 2011 for establishing the exchange rate of the euro against the US dollar, using the rate published in the Financial Times on that date (€1.00 = $1.3713).

The closing of the Exchange Offer and Consent Solicitation represents the successful conclusion of the refinancing of the Existing Notes. Concurrently with this closing, Corral Petroleum Holdings' subsidiary, Preem AB, expects that both its credit facility and the intercreditor agreement among, inter alia, Preem AB, Corral Petroleum Holdings, the lenders under the credit facility and the trustee for the New Notes will become effective, and the maturity of the Varying Rate Subordinated Notes due 2015 of Corral Petroleum Holdings will be extended to December 31, 2019.

Corral Petroleum Holdings expects to repay any Existing Notes (together with accrued interest up to but excluding the maturity date) that were not validly tendered in the Exchange Offer and Consent Solicitation at maturity, on September 19, 2011.

The New Notes offered in the exchange offer have not been registered under the U.S. Securities Act of 1933, as amended, (the "Securities Act") and unless so registered, may not be offered or sold in the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and other applicable securities laws.

This press release shall not constitute an offer or solicitation to purchase or a solicitation of consents with respect to any securities. Any such offer or solicitation will be made only by means of the Exchange Offer Memorandum and Consent Solicitation Statement.

This release is for informational purposes only and is neither an offer to exchange nor a solicitation of an offer to exchange the Existing Notes. The offers to exchange the Existing Notes are only being made pursuant to the Exchange Offer and Consent Solicitation Statement. The Exchange Offer and Consent Solicitation are not being made to holders of Existing Notes in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction. In any jurisdiction in which the securities laws or blue sky laws require the Exchange Offer and Consent Solicitation to be made by a licensed broker or dealer, the Exchange Offer and Consent Solicitation will be deemed to be made on behalf of the Company by the dealer managers, or one or more registered brokers or dealers that are licensed under the laws of such jurisdiction.

In addition, this press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements.  We have based these forward-looking statements on our current expectations and projections about future events.  Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct.  These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "anticipates", "expects", "intends", "may", "will" or "should" or, in each case, their negative, or other variations or comparable terminology.  These forward-looking statements include all matters that are not historical facts.  They appear in a number of places throughout this press release and include statements regarding our intentions, beliefs or current expectations concerning, among other things, our results of operations, financial condition, liquidity, prospects, growth, strategies and the industry in which we operate.

By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future.  We caution you that forward-looking statements are not guarantees of future performance and that our actual results of operations, our financial condition and liquidity, and the development of the industry in which we operate, may differ materially from those made in or suggested by the forward-looking statements contained in this press release.  In addition, even if our results of operations, our financial condition and liquidity, and the development of the industry in which we operate, are consistent with the forward-looking statements contained in this press release, those results or developments may not be indicative of results, conditions or developments in subsequent periods.  Important factors that could cause those differences include, but are not limited to:  (i) our substantial indebtedness and limitations on our operational flexibility arising under agreements governing our debt; (ii) volatility in refining margins and in market prices for crude oil and refined products; (iii) changes in global economic conditions and capital markets; (iv) our ability to obtain sufficient short-term credit to finance our spot market crude oil purchases and long-term credit to finance our future capital expenditures; (v) the competitive nature of our industry; (vi) operational hazards and our dependence on key refinery assets; (vii) our ability to comply with existing or newly implemented environmental regimes in the countries in which we operate; (viii) our liability for violations, known and unknown, under environmental, occupational health and safety, and other laws; (ix) our ability to remediate contaminated sites within budgeted amounts; (x) our ability to hedge against currency, commodity and interest rate risks; (xi) loss of key management; (xii) labour disruptions; and (xiii) economic disruptions in the countries in which we, our suppliers and our customers operate.

In light of these risks, uncertainties and assumptions, the forward-looking events described in this press release may not occur.

All forward-looking statements attributable to us are expressly qualified in their entirety by these cautionary statements.  We undertake no obligation to publicly update or publicly revise any forward-looking statements, whether as a result of new information, future events or otherwise.  All subsequent written and oral forward-looking statements attributable to us or to persons acting on our behalf are expressly qualified in their entirety by the cautionary statements referred to above and contained elsewhere in this press release.

Contact:  Corral Petroleum Holdings, Jason Milazzo +46-70-542-5387 or +44-79-8923-7628


SOURCE Corral Petroleum Holdings AB