Suburban Propane gets amended, restated $500 million revolver

By Sarah Lizee

Olympia, Wash., March 5 – Suburban Propane Partners, LP and Suburban Propane, LP amended and restated their credit agreement on Thursday with Bank of America, NA as administrative agent, providing for a $500 million revolver, according to an 8-K filing with the Securities and Exchange Commission.

Borrowings will be used to provide liquidity for general corporate purposes, including working capital, capital expenditures and acquisitions, and may be made from time to time until maturity on the earlier of (a) the date that is 91 days prior to maturity of the 5˝% senior notes due 2024, unless the notes have been refinanced prior to that date, and (b) March 5, 2025.

At the request of the operating partnership, and subject to obtaining additional commitments from lenders, total borrowings may be increased to $850 million and may be in the form of incremental term facilities and/or increases of the revolver.

Interest is Libor plus 150 basis points to 250 bps, based on the total consolidated leverage ratio.

The facility requires the consolidated interest coverage ratio as of the end of any fiscal quarter of the partnership to be not less than 2.5 to 1.0, prohibits the total consolidated leverage ratio as of the end of any fiscal quarter of the partnership from being greater than 5.75 to 1.00, and prohibits the senior secured consolidated leverage ratio as of the end of any fiscal quarter of the operating partnership from being greater than 3.25 to 1.00.

The credit agreement amends and restates the operating partnership’s second amended and restated credit agreement with Bank of America dated as of March 3, 2016, which provided for a $500 million revolver. At the time of the execution of the new credit agreement, the operating partnership had borrowings under the existing credit agreement of $183.9 million under the revolver, which have been rolled into the credit agreement.

Based in Whippany, N.J., Suburban Propane supplies propane, fuel oil and related products and services and markets natural gas and electricity.

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