Tallgrass revolver to expand to $1.75 billion if pipeline deal closes

By Wendy Van Sickle

Columbus, Ohio, April 28 – Tallgrass Energy Partners, LP on Wednesday amended its credit agreement dated May 17, 2013 with Barclays Bank plc as administrative agent to provide for a $250 million increase in revolving commitments if Tallgrass Development, LP closes its potential acquisition of a 25% interest in Rockies Express Pipeline LLC, according to an 8-K filing with the Securities and Exchange Commission.

The increase would lift the total commitments to $1.75 billion. Under a purchase agreement with a unit of Sempra U.S. Gas and Power, Tallgrass Development will pay a total consideration of about $440 million for the 25% interest in the pipeline.

The amendment also modified certain provisions of the credit agreement related to a potential investment in Rockies Express, including, removing the limitation on the percentage of the pipeline that the partnership may acquire without lender consent and increasing to 50% the maximum percentage of consolidated EBITDA that may be attributable to Rockies Express for purposes of calculating the financial covenants.

Tallgrass is a Leawood, Kan.-based owner, operator, acquirer and developer of midstream energy assets. Rockies Express is a natural gas pipeline based in Houston.

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