Summary
Enterprise Products Partners L.P. (EPD) filed an 8-K on April 5, 2020, reporting the entry into an Additional 364-Day Revolving Credit Agreement by its operating subsidiary, Enterprise Products Operating LLC (EPO), on April 3, 2020. This new agreement provides an incremental $1.0 billion in borrowing capacity, bringing the total available capacity under its credit agreements to approximately $7.7 billion when combined with existing facilities and cash on hand. The primary purpose of this facility is to provide additional financial flexibility for working capital, capital expenditures, acquisitions, and general corporate purposes. While the new credit line is unsecured, it is guaranteed by EPD. The agreement includes standard covenants, representations, and events of default, and notably restricts EPO's ability to pay cash distributions to EPD if an event of default occurs.
Key Highlights
- 1Enterprise Products Operating LLC (EPO) entered into a new $1.0 billion 364-Day Revolving Credit Agreement on April 3, 2020.
- 2This new credit facility increases EPO's total available borrowing capacity.
- 3The proceeds can be used for working capital, capital expenditures, acquisitions, and other company needs.
- 4The agreement is unsecured but guaranteed by the parent company, Enterprise Products Partners L.P. (EPD).
- 5As of April 3, 2020, EPD reported consolidated liquidity of approximately $7.7 billion, including this new facility.
- 6The credit agreement contains customary covenants and events of default that could impact borrowing or distributions.
- 7Distributions to EPD from EPO may be restricted if an event of default under the new credit agreement is ongoing.