Equity Issuances Seeing Double, Triple

It was a profitable time for some companies— and a costly one for others—as midstream transactions drew to a close for 2012. The year’s final months saw major moves as companies sought to reduce debt. As well, numerous assets traded hands in a series of pricey acquisitions.

Billions of dollars in equity were raised in the public-trading sector in November and early December 2012. Billions more were accumulated in debt. In November’s largest equity announcement, Apache Corp. released $2 billion in senior unsecured notes in two separate transactions. It released $1.2 billion worth of 2.625% notes due in 2023 and $800 million in 4.25% notes due in 2044.

Net proceeds will go toward repaying outstanding commercial borrowings and for general corporate purposes, Apache said in a release.

Apache wasn’t the only company whose equity issuances were seeing double. Plains All American commenced a public offering of two series of senior notes, though details were scarce by press time. Plains said in a press release that it will use proceeds from the offering to repay debt and for general partnership purposes.

Targa Resource Partners recently made numerous equity issuances as well.

Weeks after releasing $400 million worth of senior unsecured notes, Targa announced another offering. Its second offering came with the release of 9.5 million common units for $36 per unit. The partnership gave underwriters an option to buy up to 1.4 million additional units.

Proceeds from the note offering will go toward funding Targa’s proposed acquisition of Saddle Butte Pipeline LLC’s Williston basin crude oil and pipeline-terminal system. This includes its natural gas gathering and processing operations. Targa said it might also use some proceeds for general partnership purposes.

Finally, Targa announced the pricing of $200 million in aggregate principal amount of 5¼% senior notes due 2023. Proceeds from the final offering will go toward general partnership purposes, such as for working capital or for funding acquisitions.

Meanwhile, Chesapeake Energy Corp. is taking out a $2 billion loan to repay outstanding borrowings under the company’s corporate revolving credit facility.

“By using the proceeds of this loan to repay more costly debt and provide excess liquidity, we will enhance our financial flexibility and ensure our ability to complete our planned asset sales efficiently,” said Archie W. Dunham, Chesapeakes’ nonexecutive board chairman, in a release.