HOUSTON, Feb. 23, 2017 /PRNewswire/ -- Natural
Resource Partners L.P. (NYSE: NRP) announced that it has
entered into definitive agreements with current and new
stakeholders in order to strengthen its balance sheet, enhance its
liquidity and reposition the partnership for long-term
growth. At closing of the transactions contemplated by these
agreements:
- NRP will issue $250 million of a
new class of preferred units representing limited partner interests
in NRP, together with warrants to purchase common units, to
entities controlled by funds managed by Blackstone Tactical
Opportunities and to several affiliates of GoldenTree Asset
Management LP. The preferred units will have a 12.0% coupon,
one-half of which NRP may elect to pay in kind and will be
convertible and/or redeemable by NRP under certain
circumstances. Generally, NRP will have the right to settle
the preferred units and warrants in cash or common units; and
- Certain holders of NRP's 9.125% Senior Notes due 2018 (the
"2018 Notes") will exchange $241
million of their notes for a new series of 10.50% Senior
Notes due 2022 (the "2022 Notes") and will invest $105 million of new capital in NRP in exchange
for an additional $105 million of the
2022 Notes.
In addition, NRP Operating LLC's revolving credit facility will
be extended to April 2020, with
commitment reductions to $180 million
at closing, $150 million at
December 31, 2017, and $100 million at December
31, 2018 until maturity.
"These transactions mark the culmination of a two-year strategy
focused on deleveraging NRP and extending our 2018 debt
maturities," said Craig Nunez, Chief
Financial Officer. "Following the closing of these transactions, we
intend to continue to deleverage and improve our balance sheet with
the ultimate goal of returning to growth for the benefit of our
unitholders."
NRP intends to use the net proceeds from the preferred unit
investment and new notes issuance to redeem $90 million of the 2018 Notes and repay the NRP
Operating revolving credit facility in full at closing.
Following closing of the transactions announced today, NRP will
have total debt of $944 million,
including $346 million of the 2022
Notes, with expected maturities set forth at the end of this press
release. NRP intends to redeem all remaining outstanding 2018
Notes in October 2017. The terms of the transactions are
described in more detail in NRP's Current Report on Form 8-K filed
today. The transactions are expected to close in early
March.
"Today is the beginning of a new era for NRP," said Wyatt Hogan, President and Chief Operating
Officer. "The royalty nature of our coal business, combined
with the diversification of our aggregates and soda ash businesses,
have enabled us to navigate an extremely difficult period in the
coal industry specifically, and the energy industry more
broadly. Our performance in light of industry headwinds has
provided our investors and lenders the confidence to commit their
capital to NRP. We are pleased to partner with such
well-regarded, sophisticated investment firms as Blackstone and
GoldenTree. In evaluating this investment, these firms had
the vision not only to see the near-term benefits of their capital
in facilitating these transactions, but also the opportunity for
long-term value creation."
Blackstone will receive the right to appoint one member and one
observer to the Board of Directors of GP Natural Resource Partners
LLC in connection with their preferred investment in NRP. In
addition, Blackstone and GoldenTree will have consent rights with
respect to certain partnership actions.
"This investment reflects our confidence in NRP's strong
management team and its strategy to move the company forward," said
Jasvinder Khaira, Senior Managing
Director at Blackstone Tactical Opportunities. "Blackstone has
robust expertise and history in the natural resources sector, and
we believe NRP is well positioned for success in the years
ahead."
Greenhill & Co. served as financial advisors to NRP in
connection with the transactions.
Company Profile
Natural Resource Partners L.P., a master limited
partnership headquartered in Houston, TX, is a diversified
natural resource company that owns interests in coal, aggregates,
and industrial minerals across the United States. A
large percentage of NRP's revenues are generated from royalties and
other passive income. In addition, NRP owns an equity
investment in Ciner Wyoming, a trona/soda ash operation and owns
VantaCore, one of the top 25 aggregates producers in the
United States.
For additional information please contact Kathy Roberts at 713-751-7555 or
kroberts@nrplp.com. Further information about NRP is
available on the partnership's website
at http://www.nrplp.com.
Cautionary Note Regarding Forward-Looking
Statements
This press release includes "forward-looking statements" as
defined by the Securities and Exchange Commission. All statements,
other than statements of historical facts, that address financial
results, activities, events or developments that NRP expects,
believes or anticipates will or may occur in the future are
forward-looking statements. These statements are based on certain
assumptions made by NRP based on its experience and perception of
historical trends, current conditions, expected future developments
and other factors it believes are appropriate in the
circumstances. The assumptions used in preparing the
statements may prove to be incorrect in a number of material ways
and are subject to a risks and uncertainties, many of which are
beyond the control of NRP. These risks include, but are not
limited to, risks that the transactions described in this press
release may not be consummated; commodity prices; decreases in
demand for coal, aggregates and industrial minerals, including
trona/soda ash; changes in operating conditions and costs;
production cuts by our lessees; unanticipated geologic problems;
our liquidity and access to capital and financing sources; changes
in the legislative or regulatory environment and other factors
detailed in NRP's Securities and Exchange Commission filings.
NRP has no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events or
otherwise.
-table follows-
Natural Resource Partners L.P.
Pro Forma Debt Maturities
The following table summarizes NRP's long-term debt and
convertible preferred unit obligations as of December 31, 2016
and as of December 31, 2016 pro forma
for the recapitalization transactions announced today (in
millions):
|
|
Principal Payments
Due by Period
|
As of December 31,
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
Thereafter
|
|
Total
|
2018 Notes
|
|
$
|
—
|
|
|
$
|
425.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
425.0
|
|
Opco credit
facility
|
|
60.0
|
|
|
150.0
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
210.0
|
|
Opco senior notes and
other
|
|
80.6
|
|
|
80.6
|
|
|
76.0
|
|
|
54.7
|
|
|
47.0
|
|
|
164.9
|
|
|
503.8
|
|
Total
|
|
$
|
140.6
|
|
|
$
|
655.6
|
|
|
$
|
76.0
|
|
|
$
|
54.7
|
|
|
$
|
47.0
|
|
|
$
|
164.9
|
|
|
$
|
1,138.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal Payments
Due by Period
|
As of December 31,
2016 Pro Forma for Recapitalization Transactions
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
Thereafter
|
|
Total
|
Preferred Units
(1)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
250.0
|
|
|
$
|
250.0
|
|
2022 Notes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
346.0
|
|
|
346.0
|
|
2018 Notes
(2)
|
|
95.0
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
95.0
|
|
Opco credit facility
(3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Opco senior
notes
|
|
80.6
|
|
|
80.6
|
|
|
76.0
|
|
|
54.7
|
|
|
47.0
|
|
|
164.9
|
|
|
503.8
|
|
Total
|
|
$
|
180.6
|
|
|
$
|
80.6
|
|
|
$
|
76.0
|
|
|
$
|
54.7
|
|
|
$
|
47.0
|
|
|
$
|
754.9
|
|
|
$
|
1,193.8
|
|
|
|
(1)
|
Assumes no early
conversion or redemption of the preferred units pursuant to the
terms thereof.
|
(2)
|
NRP has also agreed
to redeem any and all remaining outstanding 2018 Notes within 60
days after October 1, 2017.
|
(3)
|
Assumes no additional
borrowings under the Opco revolving credit facility following
closing of the recapitalization transactions.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/nrp-announces-250-million-preferred-unit-investment-and-extension-of-2018-debt-maturities-300412321.html
SOURCE Natural Resource Partners L.P.