Sanchez Production Partners LP (SPP) priced its public offering of about 6.55 million common units representing limited partner interests at $11 each, the company said Nov. 17.
A separate, concurrent private placement of about 2.27 million common units priced at $11 each was made to Sanchez Energy Corp. (NYSE: SN).
SPP granted underwriters a 30-day option to purchase 982,620 additional units.
The net proceeds, together with about $28 million in credit facility borrowings, will be used in the following ways:
--About $80 million will help acquire a 50% equity interest in Carnero Processing LLC from Sanchez Energy, and about $24.9 million will pay the purchase price for certain wellbores and escalating working interests and other production assets that SPP intends to acquire from Sanchez Energy.
--SPP will use about $25 million from the private placement to repay outstanding credit facility borrowings.
The offering and private placement are expected to close on Nov. 22.
Citigroup, RBC Capital Markets, BofA Merrill Lynch and Johnson Rice & Co. LLC are joint book-running managers. Johnson Rice is also the structuring agent. Seaport Global Securities, Stephens Inc. and Tudor, Pickering, Holt & Co. are co-managers.
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