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Enterprise Products Partners L.P. Message Board

  • sooner.1970 sooner.1970 Dec 3, 2008 4:12 PM Flag

    New Senior Notes

    EDP today issued $500,000,000 in NEW senior notes. The notes are due 1/31/14, at 9.75% interest. While the interest rate is higher than the pre credit crisis period, the offering demonstrates that EPD will continue with their organic growth projects. Modest distribution increases are very likely in 2009, with potentially normal distribution in 2010 and thereafter.

    Great news.

    I had previously viewed the credit crisis as the greatest threat to EPD and other MLP's. Apparently, the credit crisis is beginning to thaw!!!!

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    • "That is issue with the whole system, this system of issue debt and units through brokers so that the brokers get the fat commission and the company gets the "net" on the issue... why not do what Google did on their IPO ans bypass all the brokers..."

      This is the way the markets work. Issue debt through market brokers who are paid to essentially get the borrowing entity a base price on the debt to be issued. These book runners have clients who are seeking "safe" yield going forward and there's also consultant fees on the other end for those seeking relative safety. Their analysts/consultants which may be tied to joint book runners, do the work of commercialism, encouraging investors like us to invest in the issued debt and equities.

      Google had a pent up investor rage for many years, and going solo in the free market auction during a bull market period, was pretty much all over bar the shouting. Consultants/analysts/book runners, etc, were falling all over themselves owing to Google's investor popularity, for a piece of the market making business. Most who were left out in the cold on Google's IPO, were saying $85 price was too high and many were left standing as Google's stock price rallied to over $700 at the highs.

    • 9.75% ??? Wow. That definitely is high enough to impact earnings [4% higher than before the crash = $20M less in annual earnings now]

      Of course, it's cheaper than the 12.9% analysts estimate EEP's $500M infusion of equity from Enbridge cost them.

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