Summary
ONEOK, Inc. (OKE) filed an 8-K on December 23, 2013, to report material definitive agreements related to credit facilities for ONEOK, its subsidiary ONE Gas, Inc., and its affiliate ONEOK Partners, L.P. These agreements are contingent upon the completion of the separation of ONEOK's natural gas distribution business into a stand-alone company, ONE Gas, Inc. The primary purpose of these credit agreements is to ensure adequate liquidity for working capital, capital expenditures, transaction-related expenses, and other general corporate purposes for each entity following the separation. The amendment to ONEOK's existing credit agreement will result in a $300 million unsecured revolving credit facility, with the potential to increase by $200 million. ONE Gas will have a $700 million unsecured credit facility, with a potential increase of $500 million, while ONEOK Partners will establish a $1.7 billion unsecured revolving credit facility, with a potential increase of $700 million. All credit facilities have a five-year maturity, with options for extensions, and include standard covenants and events of default.
Key Highlights
- 1ONEOK, Inc. has entered into an amendment to its Credit Agreement, to be replaced by an Amended and Restated Credit Agreement upon the completion of the separation of its natural gas distribution business into ONE Gas, Inc.
- 2The ONEOK Amended and Restated Credit Agreement will be a $300 million unsecured revolving credit facility, with an option to increase by an additional $200 million.
- 3ONE Gas, Inc. (a planned spin-off) secured a $700 million unsecured credit facility, with an option to increase by an additional $500 million.
- 4ONEOK Partners, L.P. entered into an amendment for a $1.7 billion unsecured revolving credit facility, with an option to increase by an additional $700 million.
- 5All new credit facilities are conditional on the successful completion of the Separation Transaction by March 31, 2014.
- 6These credit facilities are intended to provide liquidity for working capital, capital expenditures, and general corporate purposes for each entity.
- 7The obligations under the ONEOK and ONE Gas credit facilities are unsecured. ONEOK Partners' obligations are guaranteed by its Intermediate Partnership.