Targa Resources Corp. Announces Upsize of 9.5% Series A Preferred Stock Private Placement to Approximately $1.0 Billion
March 16 2016 - 8:00AM
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.
Forward-Looking Statements
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.
Contact investor relations by phone at (713)
584-1133.
Jennifer KnealeVice President - Finance
Matthew MeloyExecutive Vice President and Chief
Financial Officer