TULSA, Okla.–(BUSINESS WIRE)–NGL Energy Partners LP (NYSE:NGL) today announced that it has completed a portion of its deleveraging plan utilizing the $300 million in proceeds received from the sale of its 50% interest in Glass Mountain Pipeline, LLC (“Glass Mountain”). The resulting debt reduction includes a prepayment in full of all its 6.65% senior secured notes due June 19, 2022. The effective interest rate of the senior secured notes was 8.40% at the time of prepayment on December 29, 2017. In accordance with the terms of the senior secured notes, the prepayment included a make-whole premium of approximately $17.5 million, in addition to the outstanding principal balance and accrued interest.
NGL has also repurchased approximately $88.7 million in principal amount of its senior unsecured notes at various prices in the open market during the quarter ended December 31, 2017. The weighted average price paid in these open market transactions was approximately 98.8% of par value.
This debt reduction and interest savings reflect a significant move towards accomplishing NGL’s goals of deleveraging the balance sheet, increasing its financial flexibility, simplifying its capital structure, and increasing distribution coverage by reducing interest expense in the coming quarters.
The following table summarizes the balances as of December 31, 2017 for the senior secured notes and the senior unsecured notes:
|Face Amount||Prepayments / Repurchases||
|6.65% Senior Secured Notes due 2022||$||195,000||$||(195,000||)||–|
|Senior Unsecured Notes:|
|5.125% Notes due 2019||$||360,781||–||$||360,781|
|6.875% Notes due 2021||$||367,048||–||$||367,048|
|7.500% Notes due 2023||$||673,543||$||(16,954||)||$||656,589|
|6.125% Notes due 2025||$||484,300||$||(71,793||)||$||412,507|
In addition to the sale of Glass Mountain, NGL expects to close its previously announced $200 million sale of certain Retail Propane assets to DCC LPG on March 31, 2018 and plans to utilize the proceeds from that transaction to further reduce indebtedness.