Kinetik Completes Successful Comprehensive Refinancing Plan

Rhea-AI Summary

Kinetik Holdings (NASDAQ: KNTK) announced the successful completion of a comprehensive refinancing involving a new $1.25 billion unsecured revolving credit facility and a $2.0 billion unsecured term loan A facility. This refinancing leads to a fully unsecured capital structure.

Kinetik also issued $1.0 billion in sustainability-linked senior notes due 2030, aimed at enhancing liquidity and aligning with sustainability performance targets. Additionally, Kinetik's Class A Common Stock will begin trading on a stock split adjusted basis from June 9, 2022, following a two-for-one stock split.

Positive

• Secured $1.25 billion unsecured revolving credit facility and $2 billion unsecured term loan A, indicating strong financial support.
• Issuance of $1 billion sustainability-linked senior notes enhances liquidity and aligns with environmental goals.
• Transition to a fully unsecured capital structure reduces financial risk.

Negative

• None.

KNTK to Begin Trading on NASDAQ on a Stock Split Adjusted Basis Tomorrow

HOUSTON and MIDLAND, Texas, June 08, 2022 (GLOBE NEWSWIRE) -- Kinetik Holdings Inc. (NASDAQ: KNTK) (“Kinetik”) today announced that it has successfully completed its comprehensive refinancing (the “Refinancing”) consisting of a new, five-year $1.25 billion unsecured revolving credit facility (fully undrawn at close), a new, three-year $2.0 billion unsecured term loan A facility and $1.0 billion 5.875% sustainability-linked senior notes due 2030.

Following the Refinancing, Kinetik now has a fully unsecured capital structure. Kinetik used the net proceeds from the Refinancing to repay and retire all existing consolidated debt facilities and will subsequently redeem its Series A Preferred in full by year end 2022.

Its subsidiary, Kinetik Holdings LP, today has closed the previously announced offering of $1.0 billion sustainability-linked senior notes due 2030 (the “Senior Notes”). The Senior Notes are fully and unconditionally guaranteed by Kinetik. The Senior Notes mature on June 15, 2030, pay interest at the rate of 5.875% per year and are payable on June 15 and December 15 of each year. The first interest payment will be made on December 15, 2022.

The entire Refinancing is linked to Kinetik’s performance against sustainability performance targets related to greenhouse gas and methane emissions intensity reduction targets and the representation of women in corporate officer positions. The targets are set forth in Kinetik’s recently published Sustainability-Linked Financing Framework (the “Framework”). Kinetik published the Framework on May 16, 2022 and obtained a second party opinion on the Framework from ISS ESG, both of which are available on Kinetik’s website.

Finally, Kinetik’s Class A Common Stock will begin trading on NASDAQ on a stock split adjusted basis tomorrow, Thursday, June 9, 2022, in accordance with its recent two-for-one stock split announcement. The stock split was accomplished by distributing one additional share of Class A Common Stock for each share of Class A Common Stock outstanding and one additional share of Class C Common Stock for each share of Class C Common Stock outstanding. The additional shares were issued today, Wednesday, June 8, 2022 to holders of record as of the close of business on Tuesday, May 31, 2022.

“We are excited to announce the completion of the comprehensive Refinancing as we believe it materially improves and streamlines Kinetik’s capital structure with no asset level or structurally senior debt as well as solidifies our commitment to achieving Kinetik’s environmental and social sustainability performance targets,” said Jamie Welch, President & Chief Executive Officer. “Further, through the completion of the stock split, we are excited to enhance shareholder access to our stock and generally liquidity in the market.”

This news release does not constitute an offer to sell or a solicitation of an offer to buy any securities, nor shall there be any sale of any securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. The Offering was made only by means of an offering memorandum.

About Kinetik Holdings Inc.

Kinetik is a fully integrated, pure-play, Permian-to-Gulf Coast midstream C-corporation operating in the Delaware Basin. Kinetik is headquartered in Houston and Midland, Texas. Kinetik provides comprehensive gathering, transportation, compression, processing and treating services for companies that produce natural gas, natural gas liquids, crude oil and water. Kinetik posts announcements, operational updates, investor information and press releases on its website, www.kinetik.com.

Forward-looking statements

This news release includes certain statements that may constitute “forward-looking statements” for purposes of the federal securities laws. Forward-looking statements include, but are not limited to, statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “seeks,” “possible,” “potential,” “predict,” “project,” “prospects,” “guidance,” “outlook,” “should,” “would,” “will,” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. These statements include, but are not limited to, statements about Kinetik’s future plans, expectations, and objectives for Kinetik’s operations, including statements about strategy, synergies, and future operations, the extent of estimated future dividends and the effects of the Stock Split. While forward-looking statements are based on assumptions and analyses made by us that we believe to be reasonable under the circumstances, whether actual results and developments will meet our expectations and predictions depend on a number of risks and uncertainties which could cause our actual results, performance, and financial condition to differ materially from our expectations. See Part II, Item 1A. Risk Factors in our Quarterly Report on Form 10-Q for the period ended March 31, 2022. Any forward-looking statement made by us in this news release speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future development, or otherwise, except as may be required by law.

Contacts

Kinetik Investors:   
(713) 487-4832   
Maddie Wagner
Website: www.kinetik.com

FAQ

What refinancing deal did Kinetik Holdings complete recently?

Kinetik Holdings completed a comprehensive refinancing including a $1.25 billion unsecured revolving credit facility and a $2.0 billion unsecured term loan A.

When did Kinetik's Class A Common Stock start trading on NASDAQ?

Kinetik's Class A Common Stock began trading on NASDAQ on June 9, 2022, on a stock split adjusted basis.

What are the terms of Kinetik's sustainability-linked senior notes?

Kinetik issued $1.0 billion in sustainability-linked senior notes due June 15, 2030, with an interest rate of 5.875%.

How does Kinetik's refinancing impact its capital structure?

The refinancing results in a fully unsecured capital structure, eliminating all existing secured debt.