JUNO BEACH, Fla., Sept. 6, 2017 /PRNewswire/ -- NextEra Energy
Partners, LP (NYSE: NEP) today announced an offering of
$300 million in aggregate principal
amount of its convertible senior notes due 2020 (the "notes") in a
private placement to qualified institutional buyers pursuant to
Rule 144A under the Securities Act of 1933, as amended (the
"Securities Act").
Holders may convert all or a portion of their notes at any time
prior to their maturity date in principal amounts equal to
$1,000 or an integral multiple
thereof into NextEra Energy Partners common units and cash in lieu
of any fractional common unit at a price to be determined, subject
to customary conditions. The notes will be fully and
unconditionally guaranteed on a senior basis by NextEra Energy
Operating Partners, LP, a direct subsidiary of NextEra Energy
Partners.
NextEra Energy Partners intends to use a portion of the net
proceeds from this offering to fund the potential future
acquisition of renewable energy assets either from NextEra Energy
Resources, LLC, or from third parties, as well as the initial cost
of the capped call transaction described below. Any remaining
proceeds are expected to be used for general partnership
purposes.
In connection with the offering of the notes, NextEra Energy
Partners intends to enter into a capped call transaction with the
initial purchaser of the notes or its affiliate. If, upon
conversion of the notes, the price per unit of NextEra Energy
Partners common units during the relevant valuation period is above
the lower strike price, the capped call transaction is expected to
generally result in a payment to NextEra Energy Partners (if the
partnership elects to cash settle) or to reduce the potential
dilution to NextEra Energy Partners common units (if the
partnership elects to settle in NextEra Energy Partners common
units).
The offer and sale of notes, the guarantee and NextEra Energy
Partners common units, if any, issuable upon conversion of the
notes have not been registered under the Securities Act or the
securities laws of any other jurisdiction. Accordingly, the notes
are being offered and sold only to qualified institutional buyers
in reliance on Rule 144A under the Securities Act. The notes, the
guarantee and NextEra Energy Partners common units issuable upon
conversion of the notes are not transferable absent registration or
an applicable exemption from the registration requirements of the
Securities Act. This news release does not constitute an offer to
sell or a solicitation of an offer to buy the securities described
herein, nor shall there be any sale of these securities in any
state or jurisdiction in which such an offer, solicitation or sale
would be unlawful prior to registration or qualification under the
securities law of any such jurisdiction.
In addition, NextEra Energy Partners has received an offer from
NextEra Energy Resources to sell the following assets to the
partnership:
- 25.9 percent interest in Desert Sunlight 250 and Desert
Sunlight 300, which are solar energy generating facilities in
Riverside County, California, with
generating capacities of approximately 250 megawatts (MW) and 300
MW, respectively;
- Brady Wind I and Brady Wind II, which are wind energy centers in
Stark and Hettinger counties, North Dakota, with generating capacities of
approximately 149.7 MW and 149 MW, respectively; and
- Javelina I, which is an approximately 249.7-MW wind energy
center in Webb County, Texas.
NextEra Energy Partners is under no obligation to accept the
offer. Any purchase by NextEra Energy Partners of the offered
assets is subject to the negotiation of the terms of the purchase,
including the purchase price, and approval by its conflicts
committee. To the extent NextEra Energy Partners purchases such
assets, net proceeds from the offering of the notes may be used to
fund the purchase of such assets.
NextEra Energy Partners, LP
NextEra Energy Partners,
LP (NYSE: NEP) is a growth-oriented limited partnership formed by
NextEra Energy, Inc. (NYSE: NEE) to acquire, manage and own
contracted clean energy projects with stable, long-term cash flows.
Headquartered in Juno Beach,
Florida, NextEra Energy Partners owns interests in wind and
solar projects in North America,
as well as natural gas infrastructure assets in Texas. The renewable energy projects are fully
contracted, use industry-leading technology and are located in
regions that are favorable for generating energy from the wind and
sun. The seven natural gas pipelines in the portfolio are all
strategically located, serving power producers and municipalities
in South Texas, processing plants
and producers in the Eagle Ford Shale, and commercial and
industrial customers in the Houston area. The NET Mexico Pipeline, the
largest pipeline in the portfolio, provides a critical source of
natural gas transportation for low-cost, U.S.-sourced shale gas to
Mexico.
Cautionary Statements and Risk Factors That
May Affect Future Results
This news release contains
"forward-looking statements" within the meaning of the federal
securities laws. Forward-looking statements are not statements of
historical facts, but instead represent the current expectations of
NextEra Energy Partners, LP (together with its subsidiaries, NEP)
regarding future operating results and other future events, many of
which, by their nature, are inherently uncertain and outside of
NEP's control. Forward-looking statements in this news release
include, among others, statements concerning cash available for
distributions expectations and future operating performance. In
some cases, you can identify the forward-looking statements by
words or phrases such as "will," "may result," "expect,"
"anticipate," "believe," "intend," "plan," "seek," "aim,"
"potential," "projection," "forecast," "predict," "goals,"
"target," "outlook," "should," "would" or similar words or
expressions. You should not place undue reliance on these
forward-looking statements, which are not a guarantee of future
performance. The future results of NEP and its business and
financial condition are subject to risks and uncertainties that
could cause NEP's actual results to differ materially from those
expressed or implied in the forward-looking statements, or may
require it to limit or eliminate certain operations. These risks
and uncertainties include, but are not limited to, the following:
NEP has a limited operating history and its projects include
renewable energy projects that have a limited operating history.
Such projects may not perform as expected; NEP's ability to make
cash distributions to its unitholders is affected by wind and solar
conditions at its renewable energy projects; NEP's business,
financial condition, results of operations and prospects can be
materially adversely affected by weather conditions, including, but
not limited to, the impact of severe weather; Operation and
maintenance of renewable energy projects involve significant risks
that could result in unplanned power outages, reduced output,
personal injury or loss of life; Natural gas gathering and
transmission activities involve numerous risks that may result in
accidents or otherwise affect the Texas pipelines' operations; NEP depends on
the Texas pipelines and certain of
the renewable energy projects in its portfolio for a substantial
portion of its anticipated cash flows; NEP is pursuing the
expansion of natural gas pipelines in its portfolio that will
require up-front capital expenditures and expose NEP to project
development risks; NEP's ability to maximize the productivity of
the Texas pipeline business and to
complete potential pipeline expansion projects is dependent on the
continued availability of natural gas production in the
Texas pipelines' areas of
operation; Terrorist or similar attacks could impact NEP's
projects, pipelines or surrounding areas and adversely affect its
business; The ability of NEP to obtain insurance and the terms of
any available insurance coverage could be materially adversely
affected by international, national, state or local events and
company-specific events, as well as the financial condition of
insurers. NEP's insurance coverage does not insure against all
potential risks and it may become subject to higher insurance
premiums; Warranties provided by the suppliers of equipment for
NEP's projects may be limited by the ability of a supplier to
satisfy its warranty obligations, or by the terms of the warranty,
so the warranties may be insufficient to compensate NEP for its
losses; Supplier concentration at certain of NEP's projects may
expose it to significant credit or performance risks; NEP relies on
interconnection and transmission facilities of third parties to
deliver energy from its renewable energy projects and, if these
facilities become unavailable, NEP's wind and solar projects may
not be able to operate or deliver energy; If third-party pipelines
and other facilities interconnected to the Texas pipelines become partially or fully
unavailable to transport natural gas, NEP's revenues and cash
available for distribution to unitholders could be adversely
affected; NEP's business is subject to liabilities and operating
restrictions arising from environmental, health and safety laws and
regulations, compliance with which may require significant capital
expenditures, increase NEP's cost of operations and affect or limit
its business plans; NEP's renewable energy projects may be
adversely affected by legislative changes or a failure to comply
with applicable energy regulations; A change in the jurisdictional
characterization of some of the Texas pipeline entities' assets, or a change
in law or regulatory policy, could result in increased regulation
of these assets, which could have a material adverse effect on
NEP's business, financial condition, results of operations and
ability to make cash distributions to its unitholders; NEP may
incur significant costs and liabilities as a result of pipeline
integrity management program testing and any necessary pipeline
repair or preventative or remedial measures; The Texas pipelines' operations could incur
significant costs if the Pipeline and Hazardous Materials Safety
Administration or the Railroad Commission of Texas adopts more stringent regulations;
Petroleos Mexicanos (Pemex) may claim certain immunities under the
Foreign Sovereign Immunities Act and Mexican law, and the
Texas pipeline entities' ability
to sue or recover from Pemex for breach of contract may be limited
and may be exacerbated if there is a deterioration in the economic
relationship between the U.S. and Mexico; NEP does not own all of the land on
which the projects in its portfolio are located and its use and
enjoyment of the property may be adversely affected to the extent
that there are any lienholders or leaseholders that have rights
that are superior to NEP's rights or the U.S. Bureau of Land
Management suspends its federal rights-of-way grants; NEP is
subject to risks associated with litigation or administrative
proceedings that could materially impact its operations, including,
but not limited to, proceedings related to projects it acquires in
the future; NEP's wind projects located in Canada are subject to Canadian domestic
content requirements under their Feed-in-Tariff contracts; NEP's
cross-border operations require NEP to comply with anti-corruption
laws and regulations of the U.S. government and non-U.S.
jurisdictions; NEP is subject to risks associated with its
ownership or acquisition of projects or pipelines that remain under
construction, which could result in its inability to complete
construction projects on time or at all, and make projects too
expensive to complete or cause the return on an investment to be
less than expected; NEP relies on a limited number of customers and
is exposed to the risk that they are unwilling or unable to fulfill
their contractual obligations to NEP or that they otherwise
terminate their agreements with NEP; NEP may not be able to extend,
renew or replace expiring or terminated power purchase agreements
(PPA) at favorable rates or on a long-term basis; NEP may be unable
to secure renewals of long-term natural gas transportation
agreements, which could expose its revenues to increased
volatility; If the energy production by or availability of NEP's
U.S. renewable energy projects is less than expected, they may not
be able to satisfy minimum production or availability obligations
under the U.S. Project Entities' PPAs; NEP's growth strategy
depends on locating and acquiring interests in additional projects
consistent with its business strategy at favorable prices; NextEra
Energy Operating Partners' (NEP OpCo) partnership agreement
requires that it distribute its available cash, which could limit
NEP's ability to grow and make acquisitions; Lower prices for other
fuel sources may reduce the demand for wind and solar energy;
Reductions in demand for natural gas in the United States or Mexico and low market prices of natural gas
could materially adversely affect the Texas pipelines' operations and cash flows;
Government laws, regulations and policies providing incentives and
subsidies for clean energy could be changed, reduced or eliminated
at any time and such changes may negatively impact NEP's growth
strategy; NEP's growth strategy depends on the acquisition of
projects developed by NextEra Energy, Inc. (NEE) and third parties,
which face risks related to project siting, financing,
construction, permitting, the environment, governmental approvals
and the negotiation of project development agreements; Acquisitions
of existing clean energy projects involve numerous risks; Renewable
energy procurement is subject to U.S. state and Canadian provincial
regulations, with relatively irregular, infrequent and often
competitive procurement windows; NEP may continue to acquire other
sources of clean energy and may expand to include other types of
assets. Any further acquisition of non-renewable energy projects
may present unforeseen challenges and result in a competitive
disadvantage relative to NEP's more-established competitors; NEP
faces substantial competition primarily from regulated utilities,
developers, independent power producers, pension funds and private
equity funds for opportunities in North
America; The natural gas pipeline industry is highly
competitive, and increased competitive pressure could adversely
affect NEP's business; NEP may not be able to access sources of
capital on commercially reasonable terms, which would have a
material adverse effect on its ability to consummate future
acquisitions; Restrictions in NEP OpCo's subsidiaries' revolving
credit facility and term loan agreements could adversely affect
NEP's business, financial condition, results of operations and
ability to make cash distributions to its unitholders; NEP's cash
distributions to its unitholders may be reduced as a result of
restrictions on NEP's subsidiaries' cash distributions to NEP under
the terms of their indebtedness; NEP's subsidiaries' substantial
amount of indebtedness may adversely affect NEP's ability to
operate its business, and its failure to comply with the terms of
its subsidiaries' indebtedness could have a material adverse effect
on NEP's financial condition; Currency exchange rate fluctuations
may affect NEP's operations; NEP is exposed to risks inherent in
its use of interest rate swaps; NEE exercises significant influence
over NEP; NEP receives credit support from NEE and its affiliates.
NEP's subsidiaries may default under contracts or become subject to
cash sweeps if credit support is terminated, if NEE or its
affiliates fail to honor their obligations under credit support
arrangements, or if NEE or another credit support provider ceases
to satisfy creditworthiness requirements, and NEP will be required
in certain circumstances to reimburse NEE for draws that are made
on credit support; NextEra Energy Resources, LLC (NEER) or one of
its affiliates is permitted to borrow funds received by NEP's
subsidiaries and is obligated to return these funds only as needed
to cover project costs and distributions or as demanded by NEP
OpCo. NEP's financial condition and ability to make distributions
to its unitholders, as well as its ability to grow distributions in
the future, is highly dependent on NEER's performance of its
obligations to return all or a portion of these funds; NEP may not
be able to consummate future acquisitions; NEER's right of first
refusal may adversely affect NEP's ability to consummate future
sales or to obtain favorable sale terms; NextEra Energy Partners
GP, Inc. (NEP GP) and its affiliates may have conflicts of interest
with NEP and have limited duties to NEP and its unitholders; NEP GP
and its affiliates and the directors and officers of NEP are not
restricted in their ability to compete with NEP, whose business is
subject to certain restrictions; NEP may only terminate the
Management Services Agreement among, NEP, NextEra Energy Management
Partners, LP (NEE Management), NEP OpCo and NextEra Energy
Operating Partners GP, LLC (NEP OpCo GP) under certain specified
conditions; If the agreements with NEE Management or NEER are
terminated, NEP may be unable to contract with a substitute service
provider on similar terms; NEP's arrangements with NEE limit NEE's
potential liability, and NEP has agreed to indemnify NEE against
claims that it may face in connection with such arrangements, which
may lead NEE to assume greater risks when making decisions relating
to NEP than it otherwise would if acting solely for its own
account; NEP's ability to make distributions to its unitholders
depends on the ability of NEP OpCo to make cash distributions to
its limited partners; If NEP incurs material tax liabilities, NEP's
distributions to its unitholders may be reduced, without any
corresponding reduction in the amount of the IDR fee; Holders of
NEP's common units may be subject to voting restrictions; NEP's
partnership agreement replaces the fiduciary duties that NEP GP and
NEP's directors and officers might have to holders of its common
units with contractual standards governing their duties; NEP's
partnership agreement restricts the remedies available to holders
of NEP's common units for actions taken by NEP's directors or NEP
GP that might otherwise constitute breaches of fiduciary duties;
Certain of NEP's actions require the consent of NEP GP; Holders of
NEP's common units currently cannot remove NEP GP without NEE's
consent; NEE's interest in NEP GP and the control of NEP GP may be
transferred to a third party without unitholder consent; The IDR
fee may be assigned to a third party without unitholder consent;
NEP may issue additional units without unitholder approval, which
would dilute unitholder interests; Reimbursements and fees owed to
NEP GP and its affiliates for services provided to NEP or on NEP's
behalf will reduce cash distributions to or from NEP OpCo and from
NEP to NEP's unitholders, and the amount and timing of such
reimbursements and fees will be determined by NEP GP and there are
no limits on the amount that NEP OpCo may be required to pay;
Discretion in establishing cash reserves by NEP OpCo GP may reduce
the amount of cash distributions to unitholders; NEP OpCo can
borrow money to pay distributions, which would reduce the amount of
credit available to operate NEP's business; Increases in interest
rates could adversely impact the price of NEP's common units, NEP's
ability to issue equity or incur debt for acquisitions or other
purposes and NEP's ability to make cash distributions to its
unitholders; The price of NEP's common units may fluctuate
significantly and unitholders could lose all or part of their
investment; The liability of holders of NEP's common units, which
represent limited partnership interests in NEP, may not be limited
if a court finds that unitholder action constitutes control of
NEP's business; Unitholders may have liability to repay
distributions that were wrongfully distributed to them; Provisions
in NEP's partnership agreement may discourage or delay an
acquisition of NEP that NEP unitholders may consider favorable,
which could decrease the value of NEP's common units, and could
make it more difficult for NEP unitholders to change NEP's board of
directors; NEP's board of directors, a majority of which may be
affiliated with NEE, decides whether to retain separate counsel,
accountants or others to perform services for NEP; The New York
Stock Exchange does not require a publicly traded limited
partnership like NEP to comply with certain of its corporate
governance requirements; Issuance of the Series A convertible
preferred units will dilute common unitholders' ownership in NEP
and may decrease the amount of cash available for distribution for
each common unit; The Series A convertible preferred units will
have rights, preferences and privileges that are not held by, and
will be preferential to the rights of, holders of the common units;
NEP's future tax liability may be greater than expected if NEP does
not generate net operating losses (NOLs) sufficient to offset
taxable income or if tax authorities challenge certain of NEP's tax
positions; NEP's ability to use NOLs to offset future income may be
limited; NEP will not have complete control over NEP's tax
decisions; A valuation allowance may be required for NEP's deferred
tax assets; Distributions to unitholders may be taxable as
dividends; Unitholders who are not resident in Canada may be subject to Canadian tax on gains
from the sale of common units if NEP's common units derive more
than 50% of their value from Canadian real property at any time.
NEP discusses these and other risks and uncertainties in its
current report on Form 8-K filed on August
7, 2017 and other SEC filings, and this news release should
be read in conjunction with such SEC filings made through the date
of this news release. The forward-looking statements made in this
news release are made only as of the date of this news release and
NEP undertakes no obligation to update any forward-looking
statements.
View original content with
multimedia:http://www.prnewswire.com/news-releases/nextera-energy-partners-lp-announces-offering-of-300-million-in-aggregate-principal-amount-of-convertible-senior-notes-due-2020-300515116.html
SOURCE NextEra Energy Partners, LP