BreitBurn price the offering today at $21.25. Due to demand the offering was raised to 4.3M shares meaning BBEP raised 91.3M before fees. BBEP can repay ~15% of the debt with the proceeds.
On February 7, 2011, BreitBurn Energy Partners L.P. (the “Partnership”) announced that that it had commenced a registered underwritten public offering of 4,000,000 common units representing limited partner interests in the Partnership (“Common Units”). The Partnership intends to use the net proceeds from the proposed offering to reduce borrowings under its bank credit facility. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information in this Current Report, including Exhibit 99.1, is being furnished pursuant to Item 7.01 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended.
We purchased BBEP in October 2009 and are up 108%. We continue to hold and the yield is a current 7.6%. They have their gas and oil production 78% hedged into 2012 and 73% into 2013 at prices well above current market rates meaning they have locked in cash flows for the distribution through 2013.
We continue to hold as we feel energy price will continue to rise and BBEP could see even more upside should natty prices rise (we feel they will) as 65% of its production natty.
All this is exclude any potential effect of any potential acquisitions.