Summary
Targa Resources Corp. (TRGP), through its subsidiary Targa Resources Partners LP, announced on January 19, 2021, the pricing of a $1 billion offering of 4% senior unsecured notes due 2032. The offering is expected to generate net proceeds of approximately $992.3 million. These proceeds are earmarked for a significant refinancing effort, primarily to fund a cash tender offer for its outstanding 5 1/8% Senior Notes due 2025, including associated fees, premiums, and redemption of any remaining notes. The remaining funds from the note offering will be used to reduce borrowings under Targa's and its subsidiary's senior secured revolving credit facilities. This strategic move demonstrates Targa's commitment to optimizing its capital structure, extending its debt maturity profile, and enhancing its liquidity. The transaction involved BofA Securities, Inc. as the representative for the initial purchasers, who may also have existing relationships with Targa as lenders or noteholders.
Key Highlights
- 1Targa Resources Partners LP priced a $1 billion offering of 4% senior unsecured notes due 2032.
- 2Net proceeds are estimated to be approximately $992.3 million.
- 3A primary use of proceeds is a cash tender offer for the 5 1/8% Senior Notes due 2025.
- 4Remaining proceeds will be used to reduce borrowings under Targa's and its subsidiary's revolving credit facilities.
- 5This offering aims to refinance existing debt and manage the company's maturity profile.
- 6BofA Securities, Inc. acted as the representative for the initial purchasers.
- 7Some initial purchasers or their affiliates have existing financial relationships with Targa.