Atlas Energy plans $850 million revolver with DTE purchase, may approach high-yield market

By Sara Rosenberg

New York, May 21 - Atlas Energy Resources LLC plans on getting a new $850 million five-year senior secured revolving credit facility to help fund its acquisition of DTE Gas & Oil Co., company officials said in a conference call Monday.

In addition, the company is "seriously contemplating" an offering in the high-yield market sometime in the near future to repay a "high percentage" of the amount of borrowings drawn under the new revolver for the acquisition, officials said in the call.

Basically, the high-yield deal would be used to extend the expiration of the debt used for the DTE transaction, fix debt costs and provide more room under the revolver so that there's plenty of availability for future acquisitions, officials explained.

JPMorgan is the lead bank on the revolver.

Under the agreement, Atlas is buying DTE for $1.225 billion in cash, subject to purchase price adjustments and customary closing conditions.

Other acquisition financing will come from a private placement to institutional investors of $600 million, representing 24 million common and class D units having a weighted average price of $25.00 per unit.

The transaction is expected to close on June 30.

Atlas Energy is a Moon Township, Pa., energy company focused on the development and production of natural gas and, to a lesser extent, oil principally in the Appalachian Basin.

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