01—Abstract
Summary
Summary of the 8-K filed May 9, 2024. Cited figures are marked; the original filing is the authoritative source.
On May 8, 2024, Cheniere Energy Partners, L.P.
(NYSE: CQP) entered into a Purchase Agreement with a group of initial purchasers led by BofA Securities, Citigroup Global Markets, ING, MUFG, SMBC Nikko and Standard Chartered to sell $1,200,000,000a aggregate principal amount of 5.750% Senior Notes due 2034. The notes will be issued at 99.820% of par, and the offering is expected to close on May 22, 2024. The guarantors are Cheniere Energy Investments, LLC, Sabine Pass LNG-GP, LLC, Sabine Pass LNG, L.P., Sabine Pass Tug Services, LLC, Cheniere Creole Trail Pipeline, L.P. and Cheniere Pipeline GP Interests, LLC.
The Purchase Agreement includes customary representations, warranties, closing conditions and indemnification obligations. The Partnership intends to contribute the net offering proceeds to its subsidiary Sabine Pass Liquefaction, LLC (SPL), which on May 8, 2024 issued an irrevocable notice of partial redemption for $1,200,000,000b of its outstanding 5.625% Senior Secured Notes due 2025. The redemption price is the greater of 100% of principal and a make-whole amount calculated at the Treasury Rate plus 50 basis points, plus accrued and unpaid interest.
SPL intends to fund the redemption with the gross proceeds from the notes and cash on hand. The new notes will rank pari passu with existing senior notes due 2029, 2031, 2032 and 2033.
The filing also furnishes two press releases dated May 8, 2024: one announcing the offering and one announcing its pricing. Certain initial purchasers and their affiliates have provided, and may continue to provide, investment and commercial banking and financial advisory services to the Partnership in the ordinary course for customary fees.
02—Key points
Key Highlights
- Purchase Agreement signed May 8, 2024 for $1.2 billion of 5.750% Senior Notes due 2034, priced at 99.820% of par
- Notes mature August 15, 2034 and are expected to close May 22, 2024
- Proceeds to be contributed to Sabine Pass Liquefaction, LLC to redeem $1.2 billion of its 5.625% Senior Secured Notes due 2025
- Redemption price for the 2025 SPL Notes is the greater of par and a Treasury-based present value at Treasury Rate plus 50 basis points, plus accrued interest
- New notes rank pari passu with existing CQP senior notes due 2029, 2031, 2032 and 2033
- Offering was launched and priced via press releases dated May 8, 2024 (Exhibits 99.1 and 99.2)
- Several initial purchasers and affiliates have existing banking and advisory relationships with the Partnership
03—Questions
Frequently Asked Questions
How much debt is Cheniere Energy Partners issuing and on what terms?
The Partnership agreed to sell $1,200,000,000 aggregate principal amount of 5.750% Senior Notes due 2034 to a group of initial purchasers. The notes are issued at 99.820% of par, and the filing states the offering is expected to close on May 22, 2024.
What will the new notes proceeds be used for?
The Partnership intends to contribute the proceeds to its subsidiary Sabine Pass Liquefaction, LLC, which will use them, together with cash on hand, to redeem $1,200,000,000 of its 5.625% Senior Secured Notes due 2025.
How will the 2025 SPL Notes be redeemed and at what price?
SPL issued an irrevocable partial redemption notice on May 8, 2024. The redemption price is the greater of 100% of principal and a present value of remaining scheduled payments to December 1, 2024, discounted at the Treasury Rate plus 50 basis points, plus accrued and unpaid interest to the redemption date.
How do the new notes rank relative to existing debt?
The 5.750% notes due 2034 will rank pari passu in right of payment with the Partnership's existing senior notes due 2029, 2031, 2032 and 2033.
Are the notes registered for public sale?
The filing and press releases state the notes have not been registered under the Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption. The 8-K itself is not an offer to sell the notes.
04—Continue