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AltaGas lines up bank commitments for $300 million one-year revolver
By Susanna Moon
Chicago, Feb. 1 - AltaGas Ltd. said it obtained commitments form three Canadian chartered banks for a $300 million one-year revolving term credit facility, with proceeds to be used to help fund the $1.135 billion acquisition of Semco Holding Corp.
The company entered into a definitive agreement with Continental Energy Systems LLC to acquire Semco for $1.135 billion, including about $355 million of assumed debt. Semco is the sole shareholder of Semco Energy, Inc.
The acquisition funding consists of cash to close of about $780 million, which is expected to come from a combination of equity and debt, according to a company press release.
The company also plans to tap into its $1 billion of senior unsecured credit facilities already in place.
Also, in connection with the acquisition, AltaGas agreed to sell subscription receipts on a bought-deal basis for proceeds of about $350 million, with a 15% greenshoe.
The new facility and subscription receipt offering "will further increase our liquidity and provide financing certainty for this acquisition," David Cornhill, chairman and chief executive officer of AltaGas, said in the release.
"We remain committed to our investment-grade credit rating and will continue to be financially disciplined in how we finance our growth over the long-term."
AltaGas is an energy company based in Calgary, Alta.
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