Fitch rates AmeriGas notes BB/RR3

Fitch Ratings said it assigned a BB/RR3 rating to AmeriGas Partners, LP's (APU) senior unsecured note offering due 2027.

The notes are being co-issued with AmeriGas Finance Corp.

Proceeds are expected to be used to repay in full AmeriGas Finance's remaining outstanding notes due in 2022, guaranteed by AmeriGas Partners, and for general partnership purposes.

Fitch said it believes the proposed debt tender transaction to be marginally positive for AmeriGas Partners, with the potential for modest interest savings and the extension of maturities.

The long-term issuer default rating for AmeriGas Partners and its fully guaranteed financing co-borrower, AmeriGas Finance Corp. is BB.

The outlook is stable.

“APU's ratings reflect the underlying strength and size of its retail propane distribution network, broad geographic reach, adequate credit metrics, and proven ability to manage unit margins under various operating conditions,” Fitch said in a news release.

“APU's financial performance remains sensitive to weather conditions and general customer conservation, and the partnership must continue to manage volatile supply costs and customer conservation.

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