DCP Midstream to price $500 million 10-year bullet on Wednesday; initial talk 5 3/8% area

By Paul A. Harris

Portland, Ore., May 8 – DCP Midstream Operating, LP plans to price a $500 million offering of 10-year senior bullet notes (expected ratings Ba2/BB+/BB+) in a Wednesday drive-by trailing a mid-morning conference call with investors, according to market sources.

Initial guidance has the deal shaping up with a yield in the 5 3/8% area, according to a trader, who added that the deal size could grow.

Citigroup Global Markets Inc., MUFG, TD Securities (USA) LLC, J.P. Morgan Securities LLC, Mizuho Securities USA Inc., RBC Capital Markets LLC and SunTrust Robinson Humphrey Inc. are the joint bookrunners for the public offering.

PNC Capital Markets LLC, SMBC Nikko Securities America Inc., U.S. Bancorp Investments Inc. and BB&T Capital Markets are the co-managers.

The notes become callable at par three months prior to maturity but are otherwise non-callable.

The Denver-based midstream services master limited partnership plans to use the proceeds for general partnership purposes, including debt repayment under DCP Operating’s revolving credit facility, and for funding capital expenditures.

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