By Paul Deckelman
New York, Oct. 13 - Regency Energy Partners LP and Regency Energy Finance Corp. priced an upsized $600 million offering of eight-year senior notes (expected B1/B+) at par to yield 6 7/8%, according to syndicate sources.
The quick-to-market deal priced at the tight end of price talk envisioning a yield of between 6 7/8% and 7%. It was upsized from the originally announced $500 million.
Bank of America Merrill Lynch, RBS Securities Inc., Citigroup Global Markets, Inc., Credit Suisse Securities (USA) LLC, Morgan Stanley & Co. Inc. and Wells Fargo Securities, LLC were joint bookrunners on the issue.
Deutsche Bank Securities, Inc. and SunTrust Robinson Humphrey were co-managers.
The notes, sold under an offering registered with the Securities and Exchange Commission, will have call protection for the first four years after issue, the sources said.
Regency Energy - a Dallas-based company which gathers, processes and transport natural gas - plans to use the net proceeds from the offering to fund the separately announced tender offer for its $357.5 million of outstanding 8 3/8% senior notes due 2013, as well as to repay borrowings under its revolving credit facility and pay fees and expenses associated with the bond issue.
| Issuers: | Regency Energy Partners LP and Regency Energy Finance Corp.
|
| Amount: | $600 million (upsized from original $500 million)
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| Maturity: | Dec. 1, 2018
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| Securities: | Senior notes
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| Bookrunners: | Bank of America Merrill Lynch, RBS Securities Inc., Citigroup Global Markets, Inc., Credit Suisse Securities (USA) LLC, Morgan Stanley & Co. Inc. and Wells Fargo Securities, LLC
|
| Co-managers: | Deutsche Bank Securities, Inc. and SunTrust Robinson Humphrey
|
| Coupon: | 6 7/8%
|
| Price: | Par
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| Yield: | 6 7/8%
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| Spread: | 485 bps
|
| Call features: | Make-whole call at Treasuries plus 50 bps until Dec. 1, 2014, then callable according to set schedule
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| Equity clawback: | 35% of issue at 106.875 until Dec. 1, 2013
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| Change-of-control put: | 101%
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| Trade date: | Oct. 13
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| Settlement date: | Oct. 27 (T+10)
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| Expected Ratings: | Moody's: B1
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| Standard & Poor's: B+
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| Distribution: | Off shelf
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| Price talk: | 6 7/8% to 7%
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| Marketing: | Quick to market
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