Energy Transfer Operating offers to exchange Energy Transfer LP notes

By Wendy Van Sickle

Columbus, Ohio, Feb. 25 – Energy Transfer Operating, LP began offers to exchange and any all of four series of notes issued by Energy Transfer LP for new notes with the same coupon and maturity date issued by Energy Transfer Operating, according to a company news release.

The Energy Transfer LP notes covered by the offer include:

• $1,187,032,000 of 7.5% senior notes due 2020;

• $1 billion of 4.25% senior notes due 2023;

• $1.15 billion of 5.875% senior notes due 2024; and

• $1 billion of 5.5% senior notes due 2027.

For each series of notes, holders will receive at total consideration of $1,000 of new Energy Transfer Operating notes for each $1,000 principal amount of old notes tendered by the early deadline, 5 p.m. ET on March 8.

In each case, the total consideration includes $30 of new notes that will not be paid to holders who tender their notes after the early deadline.

The offers expire at 11:59 p.m., ET on March 22.

In connection with the exchange offers, Energy Transfer Operating is also soliciting consents from holders of the existing notes to amend their indentures to eliminate certain covenants, restrictive provisions and events of default.

If the proposed amendments are adopted, the existing notes will have less restrictive terms and afford reduced protections to the holders of those securities compared to those of the new notes.

In order for the proposed amendments to be adopted, holders of a majority of the existing notes outstanding must consent to them by 11:59 p.m. ET on March 22.

Each tender offer and consent solicitation is subject to a number of conditions, the release notes.

The dealer managers are Citigroup (212 723-6106 or 800 558-3745), J.P. Morgan Securities LLC (866 834-4666 or 212 834-4811) and TD Securities (USA) LLC (855 495-9846). The information agent is Global Bondholder Services Corp. (212 430-3774 or 866 924-2200).

Dallas-based Energy Transfer Partners owns and operates a portfolio of energy assets.

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