American Midstream Partners LP (NYSE: AMID) has begun an underwritten public offering of 3.4 million of its common units representing limited partner interests. The Partnership also intends to grant the underwriters a 30-day option to purchase up to 510,000 additional common units.
Upon the closing of its acquisition of a 120-mile natural gas gathering and redelivery system located in the Eagle Ford shale play from a subsidiary of Penn Virginia Corp. (PVA), the Partnership intends to use the net proceeds from this offering to fund a portion of the purchase price of the PVA asset acquisition.
In the event the Partnership does not consummate the PVA asset acquisition, the Partnership will use the net proceeds of this offering to repay a portion of the outstanding borrowings under its credit facility or for general partnership purposes. If the underwriters exercise their option to purchase additional common units, the Partnership intends to use all the net proceeds from the sale of additional common units to repay a portion of the outstanding borrowings under its credit facility.
Barclays and UBS Investment Bank will act as joint book-running managers for the offering.