JUNO BEACH, Fla., Sept. 19, 2017 /PRNewswire/ -- NextEra
Energy Partners, LP (NYSE: NEP) today announced the pricing of
$550 million of 4.25 percent senior
unsecured notes due 2024 and $550
million of 4.50 percent senior unsecured notes due 2027 (the
"notes") to be issued by its direct subsidiary, NextEra Energy
Operating Partners, LP (NEP OpCo), in a private placement to
qualified institutional buyers pursuant to Rule 144A under the
Securities Act of 1933, as amended (the "Securities Act"), and to
certain non-U.S. persons under Regulation S under the Securities
Act, subject to market and other conditions. The previously
announced offering is expected to close on Sept. 25, 2017, subject to customary closing
conditions.
The notes will pay interest semi-annually at annual rates of
4.25 percent and 4.50 percent, respectively, and will mature on
Sept. 15, 2024, and on Sept. 15, 2027, respectively. The notes will be
fully and unconditionally guaranteed on a senior basis by NextEra
Energy Partners and NextEra Energy US Partners Holdings, LLC, a
direct subsidiary of NEP OpCo ("NEP US Holdings").
NEP OpCo estimates the net proceeds from the notes offering
prior to offering expenses are approximately $1,089 million. NEP OpCo intends to use a portion
of the net proceeds from this offering to pay off the outstanding
balance of $130 million under its
revolving credit facility, repay the full $950 million outstanding existing indebtedness
under NEP US Holdings' variable rate senior secured term loan
agreements that largely mature in 2018 and pay related fees,
expenses and other costs. Any remaining proceeds are expected to be
used for general partnership purposes.
The offer and sale of notes and the guarantees 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 and to certain non-U.S. persons under
Regulation S under the Securities Act. The notes and the guarantees
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.
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.
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SOURCE NextEra Energy Partners, LP