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Tesoro Logistics to sell $600 million two-part senior notes on Monday
By Paul A. Harris
Portland, Ore., May 9 – Tesoro Logistics LP and Tesoro Logistics Finance Corp. plan to price a $600 million two-part public offering of senior notes (expected ratings Ba3/BB) on Monday trailing a mid-morning conference call with investors, according to a syndicate source.
On offer is a $250 million add-on to the 6 1/8% senior notes due Oct. 15, 2021. Those notes are callable with a make-whole call at Treasuries plus 50 basis points until Oct. 15, 2016, then become callable at 104.594. They feature a 35% equity clawback at 106.125 until Oct. 15, 2016. The original $550 million issue priced at par in July 2013.
In addition the company is offering $350 million of new eight-year senior notes, which are callable with a make-whole call at Treasuries plus 50 bps for the first three years and then become callable at a premium. The new notes also feature a three-year 35% equity clawback.
Citigroup Global Markets Inc. is the left global coordinator. MUFG is the joint global coordinator.
Barclays, Goldman Sachs & Co., J.P. Morgan Securities LLC, Mizuho Securities, Wells Fargo Securities LLC, BBVA, BofA Merrill Lynch, BNP Paribas Securities Corp., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., RBC Capital Markets, SMBC Nikko, SunTrust Robinson Humphrey Inc., TD Securities, UBS Investment Bank and U.S. Bancorp Investments Inc. are the joint bookrunners.
The San Antonio-based owner and operator of crude oil and refined products logistics plans to use the proceeds to repay debt under both its revolver and its drop down credit facility, and for general partnership purposes.
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