Tulsa’s NGL Energy Partners LP announced it has closed on more than $2 billion in newly issued senior notes and also acquired a new $500 million asset-based revolving credit facility that matures in 2026.
The company said the $2.05 billion is on 7.5% senior secured notes due 2026. The proceeds from the notes and borrowings under the ABL Facility will be used to repay all outstanding amounts under the partnership’s existing $1.915 billion revolving credit facility.
It will also repay its $250 million term credit facility. The partnership said it has about $340 million in available undle the ABL Facility.
As part of the refinancing, the company agreed to restricted payment provisions under the 2026 notes and the asset based lending facility. One of the provisions requires NGL to temporarily suspend the quarterly common unit distribution beginning with the quarter ended Dec. 31, 2020 and all distributions on the company’s preferred units.
“This refinancing of our credit facility meaningfully extends our debt maturities and provides a significant improvement in our liquidity,” stated Mike Krimbill , NGL’s CEO. “This structure also gives the Partnership additional flexibility once our leverage has been reduced and eliminates certain financial covenants.”
JP Morgan Chase Bank, N.A. is an Issuing Lender, Joint Lead Arranger, Joint Bookrunner and the Collateral and Administrative Agent for the ABL Facility. Royal Bank of Canada and Barclays Bank PLC are also Joint Lead Arrangers, Joint Bookrunners and Lenders for the ABL Facility. The Toronto-Dominion Bank, New York Branch, and Wells Fargo Bank, National Association are Issuing Lenders under the ABL Facility.
Paul Hastings LLP was legal advisor to the Partnership and Simpson Thacher & Bartlett LLP was counsel to the bank group. Intrepid Partners, LLC served as an advisor to the Partnership.
Source: Press release