Targa Resources Corp. Announces Upsize of 9.5% Series A Preferred Stock Private Placement to Approximately $1.0 Billion
Mar 16, 2016
HOUSTON, March 16, 2016 (GLOBE NEWSWIRE) -- Targa Resources Corp. ("Targa" or the "Company") (NYSE:TRGP) announced today that it has received definitive agreements for the purchase of approximately $1.0 billion of 9.5% Series A Preferred Stock (the "Preferred Stock"), which includes the Preferred Stock from Stonepeak Infrastructure Partners ("Stonepeak") that was previously announced by the Company on February 18, 2016, and additional Preferred Stock as a result of investor interest after the initial announcement from funds managed by Blackstone Tactical Opportunities, Energy Capital Partners Mezzanine Opportunities Fund, investment companies affiliated with Tortoise Capital Advisors, L.L.C. and other institutional investors (collectively with Stonepeak, the "Preferred Investors"). The private placement of the Preferred Stock is expected to close on or about Wednesday, March 16, 2016.
The Preferred Investors will acquire 965,100 newly authorized shares of 9.5% Series A Preferred Stock at $1,030 per share. The Preferred Stock can be redeemed in whole or in part at Targa's option after five years, and can be converted into Targa common stock in 2028 by the Preferred Investors or under certain circumstances by the Company. The Preferred Investors will also receive approximately 13,550,004 warrants with a strike price of $18.88 per common share and 6,533,727 warrants with a strike price of $25.11 per common share. The warrants have a seven year term.
As also originally announced on February 18, Scott Hobbs, a Stonepeak operating partner, will join Targa's board of directors as an observer.
The Company expects to use the net proceeds of the private placement to repay indebtedness and for general corporate purposes. Targa's year-end 2015 pro forma liquidity is approximately $2.7 billion.
Barclays acted as sole placement agent to the Company in connection with the sale of the securities. Vinson & Elkins LLP served as legal counsel to the Company. Sidley Austin LLP served as legal counsel to Stonepeak and advised on the structuring of the transaction.
The securities offered in the private placement have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements of the Securities Act and applicable state laws.
This press release is neither an offer to sell nor a solicitation of an offer to purchase the securities described herein.
Certain statements in this communication are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including, without limitation, statements regarding the expected benefits of the Series A Preferred Stock Private Placement to Targa and their stockholders, the expected future growth, dividends, distributions of the Company, and plans and objectives of management for future operations. All statements, other than statements of historical facts, included in this communication that address activities, events or developments that Targa expects, believes or anticipates will or may occur in the future, are forward-looking statements. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of uncertainties, factors and risks, many of which are outside the control of Targa, which could cause results to differ materially from those expected by management of Targa. Such risks and uncertainties include, but are not limited to, weather, political, economic and market conditions, including a decline in the price and market demand for natural gas, natural gas liquids and crude oil, the timing and success of business development efforts; and other uncertainties. These and other applicable uncertainties, factors and risks are described more fully in Targa's filings with the SEC, including the Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Targa does not undertake an obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
About Targa Resources Corp.
Targa Resources Corp. is a leading provider of midstream services and is one of the largest independent midstream energy companies in North America. Targa owns, operates, acquires, and develops a diversified portfolio of complementary midstream energy assets. The Company is primarily engaged in the business of: gathering, compressing, treating, processing, and selling natural gas; storing, fractionating, treating, transporting, and selling NGLs and NGL products, including services to LPG exporters; gathering, storing, and terminaling crude oil; storing, terminaling, and selling refined petroleum products.
The principal executive offices of Targa are located at 1000 Louisiana, Suite 4300, Houston, TX 77002 and their telephone number is 713-584-1000. For more information please go to www.targaresources.com.