Talos Energy priced $800 million of second-priority senior secured notes due 2034 at 8.000%, moving to refinance a higher-cost debt issue and help fund its pending Gulf of America acquisition.
The new notes are set to close on or about July 13, 2026. Proceeds are earmarked for three uses: part of the cash consideration for the acquisition, redemption of all outstanding $800 million of 9.000% second-priority senior secured notes due 2029, and related fees and expenses.
The financing lowers the coupon on the debt being refinanced by 100 basis points, from 9.000% to 8.000%, while extending maturity by five years, from 2029 to 2034.
Talos also said that if the acquisition is not completed by Dec. 31, 2026, or if the company decides not to pursue it, or if a third-party preferential right over certain assets is exercised, then $175 million of the new notes will be subject to special mandatory redemption at 100% of principal plus accrued interest.
The new notes are expected to be guaranteed by Talos and certain existing and future subsidiaries, and secured on a second-priority basis by substantially the same collateral backing the company’s first-priority revolving credit facility. The market has reacted to these announcements by moving the company's shares 1.86% to a price of $13.72. Check out the company's full 8-K submission here.
