Energy Transfer holders tender $291.95 million of 5.65% notes in offer

By Susanna Moon

Chicago, Jan. 19 - Energy Transfer Partners, LP said investors tendered $291.95 million, or 72.99%, of its $400 million of 5.65% senior notes due 2012 in one of two offers for up to $750 million principal amount of five series of notes.

The offer for the 5.65% notes expired at 5 p.m. ET on Jan. 18. Holders may continue to tender notes under the maximum tender offer until 11:59 p.m. ET on Feb. 6. The settlement dates are expected to be Jan. 19 and Feb. 7, respectively.

The company said on Jan. 9 that it was tendering for any and all of its 5.65% notes at a price of $1,028.40 per $1,000 principal amount.

In a separate offer, the company is offering to purchase an amount of the following notes equal to the difference between $750 million and the principal amount of notes purchased through the first offer:

• $600 million of 9.7% senior notes due 2019;

• $650 million of 9% senior notes due 2019;

• $350 million of 8.5% senior notes due 2014; and

• $350 million of 6% senior notes due 2013.

The notes are listed in order of acceptance priority. In addition, there is a $200 million sublimit for the 9.7% notes and a $200 million sublimit for the 9% notes.

The purchase prices for these notes will be determined by reference to a fixed spread over the yield of a reference Treasury, which is the 2% Treasury due Nov. 15, 2021 for the 9.7% notes and the 9% notes and the 0.125% Treasury due Dec. 31, 2013 for the 8.5% notes and the 6% notes.

The fixed spread is 325 basis points for the 9.7% notes, 315 bps for the 9% notes, 100 bps for the 8.5% notes and 90 bps for the 6% notes.

The prices will be calculated by the dealer managers at 2 p.m. ET on Jan. 23.

The prices in the maximum tender offer will include an early tender premium of $30 for each note tendered by the early tender date, which is 5 p.m. ET on Jan. 23.

In both offers, the company will pay accrued interest up to but excluding the settlement date.

The tender offers are subject to conditions that include, among other things, the completion of Energy Transfer Partners' plan to contribute substantially all of its propane operations to AmeriGas Partners, LP in exchange for about $2.9 billion.

The dealer managers are J.P. Morgan Securities LLC (866 834-4666 or 212 834-4811) and UBS Securities LLC (888 719-4210 or 203 719-4210). The information agent is D.F. King & Co., Inc. (800 859-8508).

Dallas-based Energy Transfer Partners owns and operates a portfolio of energy assets.

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