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SemGroup increases commitments to $1 billion, extends maturity to 2021
By Angela McDaniels
Tacoma, Wash., Sept. 30 – SemGroup Corp. said it amended and restated its credit agreement on Friday, increasing the commitments to $1 billion from $500 million and extending the maturity date to March 15, 2021.
The $500 million increase came in the form of increased commitments from existing lenders and additional commitments from new lenders, according to an 8-K filing with the Securities and Exchange Commission.
The restated credit agreement has a $300 million accordion option.
The initial interest rate is Libor plus 200 basis points. The margin ranges from 200 bps to 300 bps based the company’s leverage.
The restated credit agreement contains the following financial performance covenants:
• SemGroup’s leverage ratio may not exceed 5.5 to 1.0 as of the last day of any fiscal quarter;
• Its senior secured leverage ratio may not exceed 3.5 to 1.00 as of the last day of any fiscal quarter; and
• Its interest coverage ratio may not be less than 2.5 to 1.00 as of the last day of any fiscal quarter.
The restated credit agreement is guaranteed by all of SemGroup’s material domestic subsidiaries and secured by a lien on substantially all of the property and assets of SemGroup and the other loan parties, subject to customary exceptions.
Wells Fargo Bank, NA is the administrative agent.
The amendment and restatement occurred after the completion of SemGroup’s acquisition of Rose Rock Midstream, LP.
SemGroup provides transportation, distribution and marketing services to producers and refiners of petroleum products. Rose Rock Midstream owns, develops and operates midstream energy assets. Both are based in Tulsa, Okla.
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