Enterprise Executes $593MM of Credit Facilities
Enterprise announced that its operating partnership has executed two senior unsecured credit facilities that provide the partnership with approximately $593 million of incremental borrowing capacity. The facilities are comprised of a $375 million revolving credit facility and a 20.7 billion Japanese yen, or $218 million USD, term loan. These facilities are in addition to approximately $1.8 billion of senior unsecured revolving credit facilities available to Enterprise and its wholly-owned subsidiaries.
"Given the recent stresses in the financial markets, the general contraction of credit worldwide and limitations to the normal flow of capital globally, we believed it was prudent to provide our partnership with additional financial flexibility for the next year," said Michael A. Creel, Enterprise president and chief executive officer. "We are very pleased with the support from our credit providers in executing these facilities. Since September, credit facilities such as these have generally only been available to BBB+/Baa1 and higher rated companies."
The $375 million credit facility matures in November 2009 while the Japanese yen facility matures March 30, 2009. The Japanese yen term loan, which funded on November 17, 2008, has a fixed funded cost of approximately 4.93 percent, including the cost of related foreign exchange currency swaps in effect for the funding and maturity. The interest rate and foreign exchange costs associated with the Japanese yen facility are fixed. The Royal Bank of Scotland was the lead arranger for the $375 million credit facility while Mizuho Corporate Bank, Ltd. was the sole lead arranger and lender for the Japanese yen term loan.
In addition, Enterprise sold approximately $83 million of newly issued common units through its distribution reinvestment plan with respect to the cash distribution paid on November 12, 2008. This includes $67 million of distributions reinvested by affiliates of EPCO, Inc., the privately held company controlled by Enterprise's chairman Dan L. Duncan, including $5 million reinvested by Enterprise GP Holdings L.P., which owns the general partner of Enterprise Products Partners.
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