Alliance Resource Partners, L.P. Announces Private Offering of Senior Notes
Alliance Resource Partners (NASDAQ: ARLP) announced that its intermediate partnership, Alliance Resource Operating Partners (AROP), along with Alliance Resource Finance , plans to offer $400 million in senior unsecured notes due 2029 in a private placement, subject to market conditions. AROP intends to use part of the proceeds to redeem its 7.5% Senior Notes due 2025 and the rest for general corporate purposes. A conditional notice of redemption has been delivered for the 2025 Notes, with the redemption date set for June 28, 2024. The new notes will be offered only to qualified institutional buyers and persons outside the U.S., and won't be registered or listed on any securities exchange.
- AROP plans to offer $400 million in senior unsecured notes due 2029.
- Part of the proceeds will be used to redeem 7.5% Senior Notes due 2025, potentially improving debt structure.
- Remaining funds will be allocated for general corporate purposes, indicating potential business expansion.
- The offering is subject to market conditions, introducing uncertainty.
- The new notes will not be registered under the Securities Act, limiting investor eligibility.
- The notes will not be listed on any securities exchange, affecting liquidity and trading visibility.
Insights
Alliance Resource Partners, L.P. (ARLP) is leveraging a strategic financial maneuver by issuing
For ARLP, this move can improve liquidity and extend the debt maturity profile, which is generally positive. However, the debt remains non-registered and can only be purchased by qualified institutional buyers, limiting market accessibility and potential future liquidity. Investors should be aware that the proceeds will also be used for general corporate purposes, which might indicate further strategic movements or investments by ARLP in the near future.
In terms of overall financial health, this refinancing can signal a company’s confidence in its future earnings and cash flow stability, but market conditions and future interest rates remain critical factors to monitor. The company’s ability to manage and service its new debt obligations will be vital for its future financial stability.
AROP expects to use a portion of the net proceeds from the offering of the New Notes to fund the redemption of its outstanding
The New Notes have not been, and will not be, registered under the Securities Act of 1933, as amended (the “Securities Act”), or under the securities laws of any other jurisdiction. Thus, the New Notes may be offered only in transactions that are exempt from registration under the Securities Act and applicable state securities laws. The New Notes are offered only to qualified institutional buyers under Rule 144A and to persons outside
This press release does not constitute an offer to sell or a solicitation of an offer to buy the New Notes, nor shall there be any sale of the New Notes in any state or jurisdiction in which such an offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.
About Alliance Resource Partners, L.P.
ARLP is a diversified energy company that is currently the largest coal producer in the eastern
Cautionary Note Concerning Forward-Looking Statements
Certain statements and information in this news release constitute “forward-looking statements,” including statements regarding the intended use of proceeds. The words “believe,” “expect,” “anticipate,” “plan,” “intend,” “foresee,” “should,” “would,” “could” or other similar expressions are intended to identify forward-looking statements, which are generally not historical in nature. These forward-looking statements represent ARLP’s expectations or beliefs concerning future events, and it is possible that the results described in this news release will not be achieved. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of ARLP's control, which could cause actual results to differ materially from the results discussed in the forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and, except as required by law, ARLP does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. New factors emerge from time to time, and it is not possible for ARLP to predict all such factors. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements found in ARLP’s filings with the Securities and Exchange Commission (“SEC”), including, but not limited to, ARLP’s Annual Report on Form 10-K for the year ended December 31, 2023, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. The risk factors and other factors noted in ARLP’s SEC filings could cause actual results to differ materially from those contained in any forward-looking statement.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240528964971/en/
Investor Relations Contact:
Cary P. Marshall
Senior Vice President and Chief Financial Officer
918-295-7673
investorrelations@arlp.com
Source: Alliance Resource Partners, L.P.
FAQ
What is the amount of the senior unsecured notes ARLP is offering?
What will ARLP use the proceeds from the new notes for?
When is the redemption date for ARLP's 2025 Notes?
Will the new notes ARLP is offering be registered under the Securities Act?
Who can purchase ARLP's new senior unsecured notes?
