Velvet Energy wraps $125 million private placement; American Midstream taps market

By Susanna Moon and Wendy Van Sickle

Chicago, Oct. 6 – American Midstream Partners, LP’s subsidiary sold $60 million of its 3.77% senior secured notes due June 30, 2031 last Friday, according to an 8-K filing with the Securities and Exchange Commission.

Proceeds will be used to fund project costs incurred in connection with the construction of a new 52-mile pipeline from Winnsboro, La., to Natchez, Miss., the abandonment of about 350 miles of pipeline and provision of alternative services and associated requirements and for other general corporate purposes.

Morgan Stanley Senior Funding, Inc. was placement agent.

Denver-based American Midstream owns, operates, develops and acquires natural gas midstream energy assets.

Separately, Velvet Energy Ltd. said it completed a $125 million private placement of senior secured second-lien notes due 2023.

The notes were placed Wednesday with funds advised by FS Investments and sub-advised by GSO Capital Partners LP, and certain investment funds managed by CI Investments Inc., according to a press release.

RBC Capital Markets acted as an agent for the placement.

Proceeds will be used to temporarily pay down Velvet’s existing bank debt and to fund an expanded Edson Ellerslie development program.

Calgary, Alta.-based Velvet Energy is a full cycle, exploration and development company.

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