By Paul A. Harris
Portland, Ore., Dec. 15 – Tallgrass Energy Partners, LP and Tallgrass Energy Finance Corp. priced an upsized $750 million issue of 10-year senior notes (B1/BB-/BB-) at par to yield 6% on Tuesday, according to a syndicate source.
The issue size increased from $500 million.
The yield printed at the tight end of the 6% to 6¼% yield talk.
Timing was accelerated. When the deal was announced early Tuesday it was scheduled to remain in the market until Wednesday.
Wells Fargo Securities LLC was the left bookrunner. Joint bookrunners were Barclays, Citigroup Global Markets Inc., PNC Capital Markets LLC, TD Securities (USA) LLC, Credit Suisse Securities (USA) LLC, MUFG and Regions Securities LLC.
The Leawood, Kan.-based energy infrastructure company plans to use the proceeds to fund the concurrent tender offer for its notes due in 2023 and to redeem the notes that are not tendered. The incremental proceeds resulting from the $250 million upsizing of the deal will be used to issue a partial call notice for the outstanding 5½% senior notes due 2024.
| Issuers: | Tallgrass Energy Partners, LP and Tallgrass Energy Finance Corp.
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| Amount: | $750 million, increased from $500 million
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| Maturity: | Dec. 31, 2030
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| Securities: | Senior notes
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| Left bookrunner: | Wells Fargo Securities LLC
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| Joint bookrunners: | Barclays, Citigroup Global Markets Inc., PNC Capital Markets LLC, TD Securities (USA) LLC, Credit Suisse Securities (USA) LLC, MUFG and Regions Securities LLC
|
| Co-manager: | Blackstone Capital Markets
|
| Coupon: | 6%
|
| Price: | Par
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| Yield: | 6%
|
| Spread: | 509 bps
|
| First call: | Dec. 31, 2025 at 103
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| Trade date: | Dec. 15
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| Settlement date: | Dec. 22
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| Ratings: | Moody's: B1
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| S&P: BB-
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| Fitch: BB-
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| Distribution: | Rule 144A and Regulation S for life
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| Price talk: | 6% to 6¼%
|
| Marketing: | Drive-by
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