Ferrellgas Partners Announces New $575 Million Senior Secured Credit Facility
May 07 2018 - 9:00AM
Ferrellgas, L.P. (Ferrellgas), the operating partnership of
Ferrellgas Partners, L.P. (NYSE:FGP) (“Ferrellgas” or the
“Company”) announced today an agreement with a lending group led by
TPG Specialty Lending, Inc. (NYSE:TSLX), the middle-market lending
business of TPG Sixth Street Partners (TSSP), to provide Ferrellgas
with a new senior secured credit facility. The five-year facility
replaces the current $575 million senior secured revolving credit
facility that was scheduled to mature in October 2018. The new
facility includes a $300 million cash flow revolver supported by
commitments from TPG Specialty Lending and PNC Bank, National
Association (PNC), as well as a $275 million term loan. As of the
closing date, the revolver will have no outstanding borrowings and
provides for a transition of undrawn letters of credit issued and
outstanding of approximately $100 million seamlessly to the new
facility. The term loan will be used to repay the outstanding
amounts on the Company’s terminating bank credit facility, fees,
and expenses associated with the new facility, and will result in
approximately $75 million of surplus cash on Ferrellgas’ balance
sheet.
“We are pleased with this facility and our partnership with TPG
Specialty Lending and PNC,” said James E. Ferrell, Interim Chief
Executive Officer and President of Ferrellgas. “The facility
provides us with substantial liquidity, a long-term source of
competitively priced capital and reasonable covenants to run our
business and take advantage of opportunities to continue our recent
trend of EBITDA growth.” Ferrell added, “Through recent sales of
non-core businesses, including Bridger Rail and Bridger Energy,
along with stronger cash flows generated from our operations, we
have reduced our debt levels and strengthened our credit metrics.
Our new $575 million credit facility, coupled with our strengthened
balance sheet, provides further momentum to our business. The
company has the operating discipline and strategic flexibility to
continue to grow our customer base and safely provide those
customers with best in class service.”
Further, Ferrellgas is working to close on a multi-year
extension of its accounts receivable securitization facility and
expects to announce the closing of that facility in the near term.
The closing of that facility will provide the Company with
additional liquidity to grow the business into the future. In
addition, the Company is evaluating various options related to its
near-dated outstanding unsecured bonds. This includes
refinancing, or a transaction to exchange for new bonds, some or
all of its bonds due June 2020.
“We are grateful to the banks that have supported us in the past
and, looking forward, we are excited about our relationship with
TPG Specialty Lending and PNC,” said Doran Schwartz, Senior Vice
President and Chief Financial Officer of Ferrellgas. “We have
worked well together and structured an agreement that provides us
with a foundation for growth, as well as flexibility to address
upcoming maturities of our bonds over the next five years.”
“We are pleased to provide Ferrellgas with this strategic
capital as it continues to successfully execute its business plan,
serve customers and create value for all stakeholders,” TPG
Specialty Lending management said in a statement. “The Ferrellgas
leadership team is best-in-class and the organization has a proven
track record of profitable growth, anchored by its national
distribution density and differentiated logistics
capabilities.”
Bracewell, LLP served as legal advisor and Durham Capital Corp.
served as financial advisor to Ferrellgas. Schulte Roth & Zabel
LLP served as legal advisor to the lending group.
This press release does not constitute an offer to sell or a
solicitation of an offer to buy any securities. Any
securities that may be offered in the future in exchange for
outstanding bonds have not been and will not be registered under
the Securities Act of 1933 or the securities laws of any state or
other jurisdiction and may not be offered or sold in the United
States absent registration or an applicable exemption from
registration requirements.
About FerrellgasFerrellgas Partners, L.P.,
through its operating partnership, Ferrellgas, L.P., and
subsidiaries, serves propane customers in all 50 states, the
District of Columbia, and Puerto Rico, and provides midstream
services to major energy companies in the United States. Ferrellgas
employees indirectly own 22.8 million common units of the
partnership, through an employee stock ownership plan. Ferrellgas
Partners, L.P. filed a Form 10-K with the Securities and Exchange
Commission on September 28, 2017. Investors can request a hard copy
of this filing free of charge and obtain more information about the
partnership online at www.ferrellgas.com.
Forward Looking Statements Statements in this
release concerning expectations for the future are forward-looking
statements. A variety of known and unknown risks, uncertainties and
other factors could cause results, performance, and expectations to
differ materially from anticipated results, performance, and
expectations. These risks, uncertainties, and other factors include
those discussed in the Form 10-K of Ferrellgas Partners, L.P.,
Ferrellgas Partners Finance Corp., Ferrellgas, L.P., and Ferrellgas
Finance Corp. for the fiscal year ended July 31, 2017, the
Form 10-Q of these entities for the fiscal quarter ended
January 31, 2018 and in other documents filed from time to
time by these entities with the Securities and Exchange
Commission.
Contacts Jim Saladin, Media Relations –
jimsaladin@ferrellgas.com, 913-661-1833 Bill Ruisinger, Investor
Relations –billruisinger@ferrellgas.com, 816-792-7914
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