Howard Energy Partners (HEP) announced today that it has closed on a series of strategic financing transactions (the "Transactions"), including its inaugural senior unsecured notes offering and an extension of its $1 billion revolving credit facility. The company priced $400 million of 6.75% senior unsecured notes due 2027 (the "Securities") at par. Pro forma for the Transactions, the company has over $600 million of available liquidity and a long-term structure to prudently access institutional debt capital.
The proceeds from the Transactions will, among other things, help finance the previously announced build-out of HEP's major renewable diesel logistics facility in Port Arthur, Texas, which is underpinned by a long-term agreement with Diamond Green Diesel, a 50/50 joint venture between Valero Energy Corporation VLO and Darling Ingredients Inc. DAR. The construction of HEP's state-of-the-art renewable diesel logistics facility is underway and the facility is expected to be in-service in the fourth quarter of 2022.
"In a year where we achieved record-breaking operational and financial performance, the closing of these financing transactions marks another significant milestone for HEP as we continue to position the company for long-term growth and value creation," said HEP Chairman and Chief Executive Officer Mike Howard. "As we look forward to 2022 and beyond, we will actively pursue opportunities to scale our platform of critical midstream infrastructure and low-carbon-intensity energy assets."
RBC Capital Markets acted as lead left bookrunner on the unsecured notes offering and lead left arranger and administrative agent on the revolving credit facility. Vinson & Elkins LLP acted as counsel to HEP on the unsecured notes offering, and Sidley Austin LLP acted as counsel to HEP on the amended and restated revolving credit facility. Baker Botts L.L.P. acted as underwriters counsel on the unsecured notes offering, and Holland & Knight LLP acted as counsel to the administrative agent on the amended and restated revolving credit facility.
The Securities have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities laws. Unless so registered, the Securities may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws. HEP offered and sold the Securities only to qualified institutional buyers pursuant to Rule 144A under the Securities Act and to non-U.S. persons in transactions outside the United States pursuant to Regulation S under the Securities Act.
This press release is neither an offer to sell nor a solicitation of an offer to buy the Securities or any other securities and shall not constitute an offer to sell or a solicitation of an offer to buy, or a sale of, the Securities or any other securities in any jurisdiction in which such offer, solicitation or sale is unlawful.
About Howard Energy Partners
San Antonio-based Howard Midstream Energy Partners, LLC d/b/a Howard Energy Partners is an independent midstream energy company, owning and operating natural gas and crude oil pipelines, natural gas processing plants, refined product storage terminals, deep-water dock and rail facilities, fractionation facilities, hydrogen production facilities, and other related midstream assets in Texas, New Mexico, Oklahoma, Pennsylvania and Mexico. The company has corporate offices in San Antonio and Houston, Texas and Monterrey, Mexico. For more information on Howard Energy Partners and our mission to deliver positive energy, please visit our website at www.howardenergypartners.com.
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