By Paul A. Harris
Portland, Ore., Jan. 18 – Genesis Energy, LP and Genesis Energy Finance Corp. priced an upsized $500 million issue of 7.25-year senior notes (B2/B) at par to yield 8 7/8% in a Wednesday drive-by, according to a market source.
The issue size increased from $400 million.
The yield printed in the middle of yield talk in the 8 7/8% area. Initial guidance was in the low-9% area.
The deal, which was heard to have been playing to $2 billion of orders at midday, broke to par ½ bid, 101½ offered, a sellside source said.
Wells Fargo Securities LLC was the left bookrunner. Joint bookrunners were SMBC Nikko Securities America Inc., BofA Securities Inc., BNP Paribas Securities Corp., Capital One Securities Inc., Citigroup Global Markets Inc., Fifth Third Securities Inc., RBC Capital Markets LLC, Regions Securities LLC, Scotia Capital (USA) Inc. and Truist Securities Inc.
The Houston-based oil and gas midstream company plans to use the proceeds to fund the tender offer for its 5 5/8% senior notes due June 2024 and for general partnership purposes, including repaying a portion of the revolver borrowings outstanding under its credit facility. The incremental proceeds resulting from the $100 million upsizing of the deal will be used for general corporate purposes.
| Issuers: | Genesis Energy, LP and Genesis Energy Finance Corp.
|
| Amount: | $500 million, increased from $400 million
|
| Issue: | Senior notes
|
| Maturity: | April 15, 2030
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| Left bookrunner: | Wells Fargo Securities LLC
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| Joint bookrunners: | SMBC Nikko Securities America Inc., BofA Securities Inc., BNP Paribas Securities Corp., Capital One Securities Inc., Citigroup Global Markets Inc., Fifth Third Securities Inc., RBC Capital Markets LLC, Regions Securities LLC, Scotia Capital (USA) Inc. and Truist Securities Inc.
|
| Co-manager: | Comerica Securities Inc.
|
| Trustee: | Regions Bank
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| Counsel to issuer: | Akin Gump Strauss Hauer & Feld LLP
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| Counsel to underwriters: | Hunton Andrews Kurth LLP
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| Coupon: | 8 7/8%
|
| Price: | Par
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| Yield: | 8 7/8%
|
| Spread: | 556 bps
|
| Make-whole call: | At Treasuries plus 50 bps until April 15, 2026
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| First call: | April 15, 2026 at 104.438
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| Equity clawback: | Up to 35% at 108.875 prior to April 15, 2026
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| Trade date: | Jan. 18
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| Settlement date: | Jan. 25
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| Ratings: | Moody's: B2
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| S&P: B
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| Distribution: | SEC registered
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| Price talk: | 8 7/8% area
|
| Marketing: | Drive-by
|
| Cusip: | 37185LAN2
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