NGL Energy Partners entered into a new $250 million term loan facility with certain funds and accounts managed by affiliates of Apollo Global Management. The facility was used to refinance NGL’s existing $250 million bridge term loan facility, which was established in July 2019 with TD Securities as lead arranger and bookrunner and The Toronto-Dominion Bank, New York Branch, as initial lender. The original facility was used to finance a portion of the acquisition of Mesquite Disposals Unlimited.
The new term loan has a three-year maturity and is callable after two years at par. It bears interest at LIBOR plus 8%, subject to a 1.5% LIBOR floor and includes similar financial covenants as NGL’s existing revolving credit facility, among other terms. The loan is secured by a first lien interest in NGL’s assets.
“We are pleased to work with Apollo, a leading investment management firm, and their well-respected team on this transaction to term out the bridge facility we utilized last summer to fund the Mesquite transaction,” Mike Krimbill, CEO of NGL, said. “The Apollo team has worked closely with our management team over the past several weeks conducting due diligence and preparing documentation to complete this financing. We believe an investment by Apollo of this magnitude is a strong endorsement of our business model, strategy and future growth opportunities, particularly in our water solutions business. We also appreciate the support of TD in providing the initial facility and for being an important relationship bank in our revolving credit facility.”
“We are pleased to provide this new facility to NGL, which has built a diversified midstream company with a premier U.S. water infrastructure franchise,” Wilson Handler and Andy Safran, of Apollo’s natural resources private equity business, said in a joint statement. “With its high-quality assets, customer base and management team led by CEO Mike Krimbill, we believe NGL is well positioned for future success.”
“This financing solution reflects our expanding large-scale direct lending capabilities and completing it in partnership with our natural resources private equity team underscores the benefits of Apollo’s integrated platform,” Dan Vogel, credit managing director for Apollo, said.
TD Securities acted as debt advisor to NGL. Paul Hastings acted as legal counsel to NGL and Vinson & Elkins acted as legal counsel to Apollo.
NGL is a midstream energy company that transports, stores, markets and provides other logistics services for crude oil, natural gas liquids and other products. It also transports, treats and disposes of produced water generated as part of the oil and natural gas production process.
Apollo is an alternative investment manager.
