By James McCandless
San Antonio, May 9 – DCP Midstream, LP priced $150 million of $25-par series B fixed-to-floating rate cumulative redeemable perpetual preferred units on Wednesday, according to a market source.
Distributions will be at an annual rate of 7.875% until June 15, 2023 when they will switch to a floating rate of Libor plus 491.9 basis points.
Bank of America Merrill Lynch, Morgan Stanley, RBC Capital Markets and Wells Fargo Securities are the joint bookrunners.
The units will be callable after five years.
There is a $22.5 million greenshoe.
DCP Midstream plans to use the proceeds for general partnership purposes, including funding capital expenditures and the repayment of its indebtedness under its revolving credit facility.
The company intends to list the units on the New York Stock Exchange under the symbol “DCPPrB.”
DCP Midstream is a Denver-based natural gas pipeline company.
| Issuer: | DCP Midstream, LP
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| Issue: | 25-par series B fixed-to-floating rate cumulative redeemable perpetual preferred units
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| Amount: | $150 million, or 6 million units
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| Distribution rate: | 7.875% until June 15, 2023, then floating rate of Libor plus 419.9 bps
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| Maturity: | Perpetual
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| Greenshoe: | $22.5 million, or 900,000 units
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| Bookrunners: | Bank of America Merrill Lynch, Morgan Stanley, RBC Capital Markets and Wells Fargo Securities
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| Call option: | Callable after five years
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| Ratings: | Moody’s: B1
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| S&P: B
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| Fitch: BB-/RR6
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| Pricing date: | May 9
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| Settlement date: | May 11
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| Listing: | NYSE: DCPPrB
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