Alon talks downsized, restructured $400 million six-year notes to yield 7¾%, pricing Wednesday

By Paul A. Harris

Portland, Ore., Nov. 19 – Alon Partners, LP talked a downsized and restructured $400 million offering of six-year senior notes to yield 7¾%, according to a market source.

The deal is expected to price Wednesday afternoon.

The offer is downsized from $450 million. The maturity is reduced to six years from eight years. Call protection is increased to four years from three years.

Goldman Sachs & Co. and Deutsche Bank Securities Inc. are joint bookrunners for the Rule 144A and Regulation S with registration rights deal. Fifth Third Bank and SunTrust Robinson Humphrey Inc. are the co-managers.

Proceeds, together with the issuance of common units representing limited partner interests in Alon Partners to a subsidiary of Alon USA Energy, Inc., will be used to fund the cash portion of the pending acquisition of Alon Energy's Krotz Springs refinery, as well as to repay bank debt.

The prospective issuer, a Delaware limited partnership formed by Alon Energy, owns and operates a crude oil refinery in Big Spring, Texas.

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