Summary
This Form 8-K filing from Sempra Energy (SRE) on May 5, 2006, reports on two key financial developments. Firstly, Sempra Commodities, a subsidiary, secured a $500 million, three-year revolving credit facility, guaranteed by the parent company. This facility provides flexibility for Sempra Commodities' operations and is subject to a leverage covenant for Sempra Energy. Secondly, the report details a $2 billion, five-year credit facility for Rockies Express Pipeline LLC, in which Sempra Energy holds a one-third interest. This facility is also guaranteed by Sempra Energy and is contingent on maintaining certain ownership stakes in the pipeline. The interest rates are tied to market conditions and credit ratings. Additionally, the filing announces a significant executive appointment, with Joseph A. Householder named Senior Vice President, Controller, and Chief Tax Counsel, succeeding the retiring principal accounting officer.
Key Highlights
- 1Sempra Commodities obtained a $500 million, three-year revolving credit facility maturing in 2009, guaranteed by Sempra Energy.
- 2The credit facility for Sempra Commodities allows for borrowings and the issuance of letters of credit and bank guarantees.
- 3Sempra Energy is required to maintain a total indebtedness to total capitalization ratio of no more than 65% under the Sempra Commodities credit facility.
- 4Rockies Express Pipeline LLC, a joint venture where Sempra Energy holds a one-third stake, secured a $2 billion, five-year credit facility.
- 5Sempra Energy and Kinder Morgan Energy Partners severally guarantee the Rockies Express Pipeline credit facility based on their ownership percentages.
- 6The Rockies Express credit facility requires Sempra Energy to maintain at least a 25% ownership in Rockies Express.
- 7Joseph A. Householder was appointed Senior Vice President, Controller, and Chief Tax Counsel, effective May 4, 2006.