Energy Transfer to guarantee Regency Energy debt following merger

By Tali Rackner

Norfolk, Va., April 30 – Energy Transfer Partners, LP announced that it agreed to fully and unconditionally guarantee all payment obligations of certain Regency Energy Partners LP and Regency Energy Finance Corp. senior notes in connection with their merger agreement, according to an 8-K filing with the Securities and Exchange Commission.

The company will guarantee the following issues:

• $498.9 million of 8 3/8% senior notes due 2019;

• $400 million of 5¾% senior notes due 2020;

• $389.9 million of 8 3/8% senior notes due 2020;

• $399.6 million of 6½% senior notes due 2021;

• $500 million of 6½% senior notes due 2021;

• $700 million of 5% senior notes due 2022;

• $900 million of 5 7/8% senior notes due 2022; and

• $700 million of 5½% senior notes due 2023.

The Regency issuers also entered into a supplemental indenture with Energy Transfer’s wholly owned subsidiary, Panhandle Eastern Pipe Line Co., LP, under which Panhandle agreed to fully and unconditionally guarantee all of the payment obligations under the $600 million of 4½% senior notes due 2023.

In addition, the merger triggered a change-of-control event for Regency’s 8 3/8% notes due 2020 and 6½% notes due 2021. Regency will be required to offer to repurchase the notes at 101 plus accrued interest.

Energy Transfer is a Dallas-based energy gathering and transportation company. Regency is a midstream energy partnership, also based in Dallas.

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