Published on 1/19/2021 in the Prospect News High Yield Daily.
New Issue: Targa Resources prices upsized $1 billion 11-year senior notes at par to yield 4%
By Paul A. Harris
Portland, Ore., Jan. 19 – Targa Resources Partners LP and Targa Resources Partners Finance Corp. priced an upsized $1 billion issue of 11-year senior notes (Ba3/BB) at par to yield 4% in a Tuesday drive-by, according to market sources.
The issue size increased from $750 million.
The yield printed at the tight end of the 4% to 4¼% yield talk. Initial guidance was in the low-to-mid 4% area.
BofA Securities Inc. was the left bookrunner. Joint bookrunners were Barclays, Citigroup Global Markets Inc., J.P. Morgan Securities LLC, RBC Capital Markets LLC and Wells Fargo Securities LLC.
The Houston-based midstream energy company plans to use the proceeds to tender for and/or redeem to its 2025 notes, with remaining proceeds to be used to pay down the Targa Resources Partners credit facility and Targa Resources Corp. credit facility.
| Issuers: | Targa Resources Partners LP and Targa Resources Partners Finance Corp.
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| Amount: | $1 billion, increased from $750 million
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| Maturity: | Jan. 15, 2032
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| Securities: | Senior notes
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| Left bookrunner: | BofA Securities Inc.
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| Joint bookrunners: | Barclays, Citigroup Global Markets Inc., J.P. Morgan Securities LLC, RBC Capital Markets LLC and Wells Fargo Securities LLC
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| Co-lead managers: | MUFG, PNC Capital Markets LLC, Scotia Capital (USA) Inc., SMBC Nikko Securities America Inc., TD Securities (USA) LLC and Truist Securities Inc.
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| Co-managers: | CIBC World Markets Corp., Citizens Capital Markets Inc., Credit Agricole CIB, Fifth Third Securities Inc. and Regions Securities LLC
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| Coupon: | 4%
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| Price: | Par
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| Yield: | 4%
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| Spread: | 289 bps
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| First call: | July 15, 2026 at 102
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| Trade date: | Jan. 19
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| Settlement date: | Feb. 2
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| Ratings: | Moody's: Ba3
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| S&P: BB
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| Distribution: | Rule 144A and Regulation S with contingent registration rights
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| Price talk: | 4% to 4¼%
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| Marketing: | Drive-by
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