Summary
Kinder Morgan, Inc. (KMI) filed an 8-K on February 27, 2018, announcing its intention to issue $2 billion in senior notes to bolster its liquidity and for general corporate purposes. The offering comprises $1.25 billion of 4.300% Senior Notes due 2028 and $750 million of 5.200% Senior Notes due 2048. This move is primarily aimed at repaying commercial paper and existing revolving credit facility borrowings, indicating a strategic refinancing effort by the company. The company expects to use the net proceeds from this debt issuance to manage its short-term debt obligations and for general corporate needs. The issuance is governed by a customary underwriting agreement and will be documented under an existing indenture. Investors should note that the underwriters and their affiliates have existing business relationships with KMI, including lending under its credit facility, and will therefore be recipients of a portion of the offering proceeds.
Key Highlights
- 1KMI is issuing $2 billion in aggregate principal amount of senior notes.
- 2The offering includes $1.25 billion of 4.300% Senior Notes due 2028.
- 3The offering also includes $750 million of 5.200% Senior Notes due 2048.
- 4Proceeds are intended to repay commercial paper and borrowings under KMI's revolving credit facility.
- 5The notes are guaranteed by a Cross Guarantee Agreement.
- 6Interest on the notes will be payable semi-annually starting September 1, 2018.
- 7The company is engaging in a refinancing of its debt obligations.