Antero Midstream gets $1 billion revolver, Antero Resources amends loan

By Marisa Wong

Madison, Wis., Nov. 17 – Antero Midstream Partners LP entered into a new $1 billion revolving credit facility on Nov. 10 in connection with the closing of its initial public offering of common units, according to an 8-K filing with the Securities and Exchange Commission.

Wells Fargo Bank, NA is the administrative agent, letter-of-credit issuer and swingline lender.

Wells Fargo Securities, LLC is joint lead arranger and bookrunner; J.P. Morgan Securities LLC is joint lead arranger; JPMorgan Chase Bank, NA is syndication agent; and Barclays Bank plc, Capital One NA, Citibank, NA and Credit Agricole Corporate and Investment Bank are co-documentation agents.

The new revolving credit facility provides includes a $150 million letter-of-credit sublimit.

The credit facility will mature on Nov. 10, 2019.

Borrowings bear interest at Libor administered by the ICE Benchmark Administration for one, two, three, six or 12 months plus an applicable margin ranging from 150 to 225 basis points, depending on the leverage ratio.

The revolver is secured by mortgages on substantially all of the partnership’s properties and guarantees from its restricted subsidiaries.

The credit facility contains a number of restrictive covenants and also requires the partnership to maintain the following financial ratios: an interest coverage ratio of at least 2.5 to 1.0 at the end of each fiscal quarter, provided that upon obtaining investment-grade rating, the borrower may elect not to be subject to that ratio; a consolidated total leverage ratio of not more than 5.0 to 1.0, provided that after electing to issue high-yield notes, the consolidated total leverage ratio will not be more than 5.25 to 1.0, or, following the election of the borrower for one fiscal quarter after a material acquisition, 5.50 to 1.0; and if the partnership elects to issue high-yield notes, a consolidated senior secured leverage ratio of not more than 3.75 to 1.0.

Amendments

On Nov. 7, Antero Midstream LLC, a wholly owned subsidiary of Antero Resources Partners LP, entered into a fourth amendment to its credit agreement with JPMorgan Chase Bank, NA as administrative agent.

The amendment to the Midstream credit facility provided for an increase in the commitments to $600 million.

On Nov. 10, the Midstream credit facility was replaced by a sub-facility with Antero Water LLC, a wholly owned subsidiary of Antero Resources Corp., that provides for separate borrowings attributable to Antero Resources’ water services business.

Also on Nov. 10, Antero Resources entered into a 15th amendment to its fourth amended and restated credit agreement with JPMorgan Chase Bank, NA as administrative agent.

The amendment makes changes to permit the replacement of the Midstream credit facility with the Water facility.

Aggregate commitments under the Water facility are $200 million.

Under terms of Antero Resources’ credit agreement and the Water facility, borrowings under the Water facility reduce availability under the Antero Resources’ facility on a dollar-for-dollar basis.

The Water facility will mature at the earliest of (a) the disposition of all the assets of Antero Water, (b) the disposition of all of the equity interests in Antero Water to Antero Resources Partners or (c) May 12, 2016.

The Water facility contains covenants that are substantially identical to those under Antero Resources’ credit agreement. These covenants include restrictions on indebtedness.

Antero is an oil and gas company based in Denver.

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