Genesis to use $550 million bonds, revolver for alkali purchase

New York, Aug. 3 – Genesis Energy, LP plans a $550 million high-yield bond offering and a draw under its existing revolving credit facility to help finance its acquisition of the alkali business from Tronox Ltd. for $1,352,000,000 in cash.

Genesis will also raise $750 million from the sale of convertible preferred units to KKR & Co. LP and GSO Capital Partners LP, according to a news release and an investor presentation.

The convertible preferreds will pay an 8.75% dividend. Genesis will sell 22.2 million units at $33.71 each.

Closing of the acquisition is planned for the second half of this year.

“The acquisition of Tronox’s alkali business is an exciting growth opportunity for us. We believe the acquisition to be immediately deleveraging and will provide further diversification and substantial scale to the partnership,” said Grant E. Sims, chief executive officer of Genesis, in the news release.

The alkali business is the world’s largest producer of soda cash.

Genesis Energy is a midstream energy master limited partnership based in Houston.

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