By Cristal Cody
Tupelo, Miss., Jan. 8 – Energy Transfer Operating LP priced $4 billion of senior notes (Baa3/BBB-/BBB-) in three tranches on the tight side of guidance and better than initial talk on Tuesday, according to a market source.
The company sold $750 million of 4.5% notes due April 15, 2024 at a spread of 200 basis points over Treasuries.
A $1.5 billion tranche of 5.25% notes due April 15, 2029 priced with a Treasuries plus 255 bps spread.
Energy Transfer Partners sold $1.75 billion of 6.25% 30-year notes at a 325 bps over Treasuries spread.
The company dropped an initial planned offering of notes due April 15, 2021 from the final deal.
BofA Merrill Lynch, Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC, RBC Capital Markets LLC and SunTrust Robinson Humphrey Inc. were the bookrunners.
Proceeds will be used to repay a $1.22 billion term loan due Feb. 2, 2024, the company’s 9.7% senior notes due March 15, 2019, its 9% senior notes due April 15, 2019, a subsidiary’s 8.125% senior notes due June 1, 2019, a portion of the borrowings under the company’s revolving credit facility and for general partnership purposes.
Energy Transfer is a natural gas midstream and intrastate transportation and storage company based in Dallas.
| Issuer: | Energy Transfer Operating LP
|
| Amount: | $4 billion
|
| Description: | Senior notes
|
| Bookrunners: | BofA Merrill Lynch, Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC, RBC Capital Markets LLC and SunTrust Robinson Humphrey Inc.
|
| Trade date: | Jan. 8
|
| Ratings: | Moody’s: Baa3
|
| S&P: BBB-
|
| Fitch: BBB-
|
| Distribution: | SEC registered
|
|
|
| Five-year notes
|
| Amount: | $750 million
|
| Maturity: | April 15, 2024
|
| Coupon: | 4.5%
|
| Spread: | Treasuries plus 200 bps
|
| Price guidance: | Treasuries plus 205 bps area, plus or minus 5 bps; initial talk at Treasuries plus 230 bps area
|
|
|
| 10-year notes
|
| Amount: | $1.5 billion
|
| Maturity: | April 15, 2029
|
| Coupon: | 5.25%
|
| Spread: | Treasuries plus 255 bps
|
| Price guidance: | Treasuries plus 260 bps area, plus or minus 5 bps; initial talk at Treasuries plus 280 bps area
|
|
|
| 30-year notes
|
| Amount: | $1.75 billion
|
| Maturity: | April 15, 2049
|
| Coupon: | 6.25%
|
| Spread: | Treasuries plus 325 bps
|
| Price guidance: | Treasuries plus 330 bps area, plus or minus 5 bps; initial talk at Treasuries plus 355 bps area
|
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