Deal sells units at $23.10 apiece to Atlas Energy to fund acquisition
By Devika Patel
Knoxville, Tenn., June 10 - Atlas Resource Partners, LP arranged a private placement of class C preferred units with Atlas Energy, LP on June 9, according to an 8-K filed Monday with the Securities and Exchange Commission. The deal will raise about $125 million.
The company will sell the units at $23.10 apiece. The price per unit is a 0.22% premium to the June 7 closing share price of $23.05.
Atlas Energy may convert the units into common units on a one for one basis. Unless previously converted, the units will automatically convert to common units after three years.
The units will pay cash distributions in an amount equal to the greater of $0.51 per unit and the distributions payable on each common unit at each quarterly distribution date.
Atlas Energy will also receive 15% warrant coverage. The warrants are exercisable for common units at an exercise price equal to the face value of the preferred units.
Proceeds will be used to acquire natural gas proved reserves in the Raton, N.M., and Black Warrior, Ala., Basins from EP Energy E&P Co., LP.
Atlas is a natural gas and oil producer based in Pittsburgh.
| Issuer: | Atlas Resource Partners, LP
|
| Issue: | Class C preferred units
|
| Amount: | $125 million (approximate)
|
| Price: | $23.10
|
| Distributions: | The greater of $0.51 per unit and the distributions payable on each common unit at each quarterly distribution date
|
| Conversion ratio: | One for one
|
| Warrants: | 15% coverage
|
| Warrant strike price: | Equal to the face value of the preferred units
|
| Investor: | Atlas Energy, LP
|
| Pricing date: | June 9
|
| Stock symbol: | NYSE: ARP
|
| Stock price: | $23.05 at close June 7
|
| Market capitalization: | $978.47 million
|
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