Kinder Morgan $8.6 billion credit facility likely 2007 business

By Sara Rosenberg

New York, Nov. 17 - Kinder Morgan Inc.'s proposed $8.6 billion credit facility (Ba2) will most likely be launched to retail investors in 2007, although senior managing agent rounds for the transaction are currently under way, according to a market source.

The facility consists of a $2 billion 61/2-year term loan A, a $2.1 billion seven-year term loan B, a $1.5 billion seven-year term loan C, a $2 billion three-year term loan D, of which an agreed portion will be made available to a Canadian subsidiary, and a $1 billion six-year revolver, the source said.

According to various filings with the Securities and Exchange Commission, the term loan B could have carried a size of up to $5.6 billion, but had the ability to have both the term loan A and the term loan C carved out of it.

Goldman Sachs, Citigroup, Deutsche Bank, Wachovia and Merrill Lynch are joint bookrunners on the deal, with Goldman the left lead.

In addition, Goldman is co-lead arranger on all loan tranches, Citigroup is co-lead arranger for the term loan B, Deutsche is co-lead arranger for the term loan C, and Wachovia is the co-lead arranger on the term loan D and the revolver.

Furthermore, Citigroup is administrative agent, Goldman and Deutsche are co-syndication agents, and Wachovia and Merrill are co-documentation agents.

The credit facility contains a $1.5 billion accordion feature.

Proceeds will be used to help fund the company's public-to-private buyout by management and equity investors.

Under the acquisition, Richard D. Kinder, chairman and chief executive officer, and other members of management, including co-founder Bill Morgan, current board members Fayez Sarofim and Mike Morgan, and investment partners Goldman Sachs Capital Partners, American International Group, Inc., The Carlyle Group and Riverstone Holdings LLC, will acquire all of the outstanding common stock of Kinder Morgan for $107.50 per share in cash.

All in all, the transaction valued at about $22 billion. This includes the assumption of about $7 billion of debt.

Total equity to be contributed by the sponsors, Richard Kinder and the other members of management or directors, either through cash or the contribution of rollover shares, is $7.9 billion.

Kinder Morgan is a Houston-based energy infrastructure provider.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.