KNOT Offshore Partners to sell $50 million 8% series A convertible preferred units

By Stephanie N. Rotondo

Seattle, Dec. 6 – KNOT Offshore Partners LP is offering $50 million of 8% series A convertible preferred units via a private placement, the company said in a press release on Tuesday.

The series A preferred units purchase agreement is slated to close in January.

There is a $49 million over-allotment option.

The units are generally convertible at the holder’s option after the second anniversary of issuance on a one-for-one basis. However, the conversion rate will be redetermined quarterly.

The units are redeemable at the company’s option after the second anniversary of issuance. Holders can put the units to the company in the event of a change of control or at the 10th anniversary of issuance. In the case of the latter event, holders will receive, at the company’s option, 70% of the cash value of the units or 80% of the value in common units.

Proceeds will be used for general partnership purposes, which may include acquisitions, capital expenditures or the repayment of debt.

KNOT Offshore is an Aberdeen, Scotland-based shuttle tanker operator.

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