Finance & Investing | Fundraising | Capital Markets | Private Equity Activity
Plains All American Wraps Up $1.6 Billion Unit Offering
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Plains All American Pipeline, L.P. has closed the previously announced sale of approximately 61 million units of a newly authorized series of 8% perpetual Series A Convertible Preferred Units at a price of $26.25 per unit. The Preferred Units will pay quarterly distributions at an annual rate of $2.10 per unit. After two years, the Preferred Units are convertible at the holders’ option into PAA common units on a one for one basis (subject to customary anti-dilution adjustments), and are convertible at PAA’s option in certain circumstances after three years.
The net proceeds, after deducting offering expenses and the transaction fee due to the purchasers and including the general partner’s proportionate 2% equity contribution, are approximately $1.6 billion. This amount represents an increase of approximately $140 million in additional net proceeds relative to anticipated net proceeds announced on January 12, 2016, due to additional commitments received by PAA since that date. PAA expects to use the proceeds for capital expenditures, repayment of debt, and general partnership purposes. The primary purchasers included affiliates of EnCap Investments L.P., EnCap Flatrock Midstream, The Energy Minerals Group, Kayne Anderson Capital Advisors, L.P., First Reserve Advisors, L.L.C. and Stonepeak Partners LP.
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