MTP Energy Management and Harvest Partners have completed a USD80m investment in series A convertible preferred units of Regency Energy Partners.
MTP Energy Management and Harvest Partners have completed a USD80m investment in series A convertible preferred units of Regency Energy Partners.
Dallas-based Regency is a midstream natural gas services provider committed to enhancing and building America’s energy infrastructure.
Regency owns approximately 5,950 miles of gathering pipeline and nine active treating/processing plants in Louisiana, the Mid-continent region (Kansas and Oklahoma), and East, South and West Texas. It also has a 38 per cent interest in the Haynesville Joint Venture, which owns the Regency Intrastate Gas System, consisting of 320 miles of intrastate pipeline in North Louisiana. Regency’s assets also include over 767,000 third-party revenue generating horsepower of compression in Arkansas, Louisiana and Texas.
The units were priced at USD18.30 per unit, pay a fixed quarterly distribution of USD0.445 per unit and are convertible into common units on a one-for-one basis following a six-month period.
Regency intends to use USD63m of the net proceeds from the offering to purchase an additional five per cent ownership interest in the Haynesville Joint Venture from an affiliate of GE Energy Financial Services.
Upon closing, Regency’s total ownership interest in the Joint Venture will be 43 per cent, and an affiliate of GE Energy Financial Services will retain a seven per cent partnership interest.
Regency intends to use the balance of the proceeds from the offering to fund ongoing, fee-based growth projects and further strengthen its position in the Haynesville Shale.
Michael B. DeFlorio, senior managing director at Harvest Partners, says: ‘We are delighted to announce our investment in Regency, which greatly advances Harvest’s long-term commitment to the energy sector. Regency embodies our investment strategy focused on exceptionally-managed, fee-based midstream service providers participating in the most promising resource plays in the industry. We are also pleased to have the opportunity to partner with MTP Energy in this transaction and leverage MTP’s energy investment expertise.’
