JUNO
BEACH, Fla., Dec. 4, 2023
/PRNewswire/ -- NextEra Energy Partners, LP (NYSE: NEP) today
announced the pricing of the previously announced private offering
of $750 million of 7.25% senior
unsecured notes due 2029 (the "notes") to be issued by its
direct subsidiary, NextEra Energy Operating Partners,
LP ("NEP OpCo"). The offering is expected to close on Dec.15,
2023, subject to customary closing conditions.
The notes will pay interest semi-annually at the annual rate of
7.25% and will mature on Jan. 15,
2029. The notes will be fully and unconditionally guaranteed
on a senior unsecured basis by NextEra Energy Partners,
LP and NextEra Energy US Partners Holdings, LLC ("NEP US
Holdings"), a direct subsidiary of NEP OpCo.
NEP OpCo estimates the net proceeds from the notes offering will
be approximately $740 million, after deducting the initial
purchasers' discount and commission and estimated offering expenses
payable by NEP OpCo. NEP OpCo will add the net proceeds from the
sale of the notes to its general funds. NEP OpCo expects to use its
general funds to repay its 4.25% senior notes due in July 2024 and to repay its remaining outstanding
4.25% senior notes due in September
2024. In advance of such use, NEP OpCo expects to use the
proceeds to repay borrowings outstanding under its revolving credit
facility and may temporarily invest the proceeds in short-term
instruments or may use the proceeds for other general partnership
purposes.
The offer and sale of notes and the guarantees have not been
registered under the Securities Act of 1933, as amended (the
"Securities Act") or the securities laws of any other jurisdiction.
Accordingly, the notes are being offered and sold only to qualified
institutional buyers in reliance on Rule 144A under the Securities
Act and to certain non-U.S. persons under Regulation S under the
Securities Act. The notes and the guarantees are not transferable
absent registration or an applicable exemption from the
registration requirements of the Securities Act. This news release
does not constitute an offer to sell or a solicitation of an offer
to buy the securities described herein, nor shall there be any sale
of these securities in any state or jurisdiction in which such an
offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities law of any such
jurisdiction.
NextEra Energy Partners, LP
NextEra Energy Partners, LP (NYSE: NEP) is a growth-oriented
limited partnership formed by NextEra Energy, Inc. (NYSE:
NEE). NextEra Energy Partners acquires, manages and owns
contracted clean energy projects with stable, long-term cash flows.
Headquartered in Juno Beach, Florida, NextEra Energy
Partners owns interests in geographically diverse wind, solar
and energy storage projects in the U.S. as well as
natural gas infrastructure assets
in Texas and Pennsylvania. For more information
about NextEra Energy Partners, please visit:
www.NextEraEnergyPartners.com.
Cautionary Statements and Risk Factors That May Affect Future
Results
This news release contains "forward-looking statements" within
the meaning of the federal securities laws. Forward-looking
statements are not statements of historical facts, but instead
represent the current expectations of NextEra Energy Partners, LP
(together with its subsidiaries, NEP) regarding future operating
results and other future events, many of which, by their nature,
are inherently uncertain and outside of NEP's control.
Forward-looking statements in this news release include, among
others, statements concerning future financing activities.
In some cases, you can identify the forward-looking statements by
words or phrases such as "will," "may result," "expect,"
"anticipate," "believe," "intend," "plan," "seek," "aim,"
"potential," "projection," "forecast," "predict," "goals,"
"target," "outlook," "should," "would" or similar words or
expressions. You should not place undue reliance on these
forward-looking statements, which are not a guarantee of future
performance. The future results of NEP and its business and
financial condition are subject to risks and uncertainties that
could cause NEP's actual results to differ materially from those
expressed or implied in the forward-looking statements. These risks
and uncertainties could require NEP to limit or eliminate certain
operations. These risks and uncertainties include, but are not
limited to, the following: NEP's ability to make cash distributions
to its unitholders is affected by the performance of its renewable
energy projects which could be impacted by wind and solar
conditions and in certain circumstances by market prices; operation
and maintenance of renewable energy projects and pipelines involve
significant risks that could result in unplanned power outages,
reduced output or capacity, personal injury or loss of life; NEP's
business, financial condition, results of operations and prospects
can be materially adversely affected by weather conditions,
including, but not limited to, the impact of severe weather; NEP
depends on certain of the renewable energy projects and pipelines
in its portfolio for a substantial portion of its anticipated cash
flows; NEP may pursue the repowering of renewable energy projects
or the expansion of natural gas pipelines that would require
up-front capital expenditures and could expose NEP to project
development risks; geopolitical factors, terrorist acts,
cyberattacks or other similar events could impact NEP's projects,
pipelines or surrounding areas and adversely affect its business;
the ability of NEP to obtain insurance and the terms of any
available insurance coverage could be materially adversely affected
by international, national, state or local events and
company-specific events, as well as the financial condition of
insurers. NEP's insurance coverage does not provide protection
against all significant losses; NEP relies on interconnection,
transmission and other pipeline facilities of third parties to
deliver energy from its renewable energy projects and to transport
natural gas to and from its pipelines. If these facilities become
unavailable, NEP's projects and pipelines may not be able to
operate or deliver energy or may become partially or fully
unavailable to transport natural gas; NEP's business is subject to
liabilities and operating restrictions arising from environmental,
health and safety laws and regulations, compliance with which may
require significant capital expenditures, increase NEP's cost of
operations and affect or limit its business plans; NEP's renewable
energy projects or pipelines may be adversely affected by
legislative changes or a failure to comply with applicable energy
and pipeline regulations; Petroleos Mexicanos (Pemex) may claim
certain immunities under the Foreign Sovereign Immunities Act and
Mexican law, and the subsidiaries' of NEP that directly own the
natural gas pipeline assets located in Texas ability to sue or recover from Pemex for
breach of contract may be limited and may be exacerbated if there
is a deterioration in the economic relationship between the U.S.
and Mexico; NEP does not own all
of the land on which the projects in its portfolio are located and
its use and enjoyment of the property may be adversely affected to
the extent that there are any lienholders or land rights holders
that have rights that are superior to NEP's rights or the U.S.
Bureau of Land Management suspends its federal rights-of-way
grants; NEP is subject to risks associated with litigation or
administrative proceedings that could materially impact its
operations, including, but not limited to, proceedings related to
projects it acquires in the future; NEP's operations require NEP to
comply with anti-corruption laws and regulations of the U.S.
government and Mexico; NEP is
subject to risks associated with its ownership interests in
projects that are under construction, which could result in its
inability to complete construction projects on time or at all, and
make projects too expensive to complete or cause the return on an
investment to be less than expected; NEP relies on a limited number
of customers and is exposed to the risk that they may be unwilling
or unable to fulfill their contractual obligations to NEP or that
they otherwise terminate their agreements with NEP; NEP may not be
able to extend, renew or replace expiring or terminated power
purchase agreements (PPA), natural gas transportation agreements or
other customer contracts at favorable rates or on a long-term
basis; if the energy production by or availability of NEP's
renewable energy projects is less than expected, they may not be
able to satisfy minimum production or availability obligations
under their PPAs; NEP's growth strategy depends on locating and
acquiring interests in additional projects consistent with its
business strategy at favorable prices; reductions in demand for
natural gas in the U.S. or Mexico
and low market prices of natural gas could materially adversely
affect NEP's pipeline operations and cash flows; government laws,
regulations and policies providing incentives and subsidies for
clean energy could be changed, reduced or eliminated at any time
and such changes may negatively impact NEP's growth strategy; NEP's
growth strategy depends on the acquisition of projects developed by
NextEra Energy, Inc. (NEE) and third parties, which face risks
related to project siting, financing, construction, permitting, the
environment, governmental approvals and the negotiation of project
development agreements; acquisitions of existing clean energy
projects involve numerous risks; NEP may continue to acquire other
sources of clean energy and may expand to include other types of
assets. Any further acquisition of non-renewable energy projects
may present unforeseen challenges and result in a competitive
disadvantage relative to NEP's more-established competitors; NEP
faces substantial competition primarily from regulated utility
holding companies, developers, independent power producers, pension
funds and private equity funds for opportunities in North America; the natural gas pipeline
industry is highly competitive, and increased competitive pressure
could adversely affect NEP's business; NEP may not be able to
access sources of capital on commercially reasonable terms, which
would have a material adverse effect on its ability to consummate
future acquisitions and pursue other growth opportunities;
restrictions in NEP and its subsidiaries' financing agreements
could adversely affect NEP's business, financial condition, results
of operations and ability to make cash distributions to its
unitholders; NEP's cash distributions to its unitholders may be
reduced as a result of restrictions on NEP's subsidiaries' cash
distributions to NEP under the terms of their indebtedness or other
financing agreements; NEP's subsidiaries' substantial amount of
indebtedness may adversely affect NEP's ability to operate its
business, and its failure to comply with the terms of its
subsidiaries' indebtedness could have a material adverse effect on
NEP's financial condition; if NEP is not able to close the sale of
the Texas pipelines as planned,
NEP would have to rely on other sources of capital to finance its
plan to purchase noncontrolling membership interests in certain of
its subsidiaries and to repay certain borrowings; NEP is exposed to
risks inherent in its use of interest rate swaps; widespread public
health crises and epidemics or pandemics may have material adverse
impacts on NEP's business, financial condition, liquidity, results
of operations and ability to make cash distributions to its
unitholders; NEE has influence over NEP; under the cash sweep and
credit support agreement, NEP receives credit support from NEE and
its affiliates. NEP's subsidiaries may default under contracts or
become subject to cash sweeps if credit support is terminated, if
NEE or its affiliates fail to honor their obligations under credit
support arrangements, or if NEE or another credit support provider
ceases to satisfy creditworthiness requirements, and NEP will be
required in certain circumstances to reimburse NEE for draws that
are made on credit support; NextEra Energy Resources, LLC (NEER)
and certain of its affiliates are permitted to borrow funds
received by NextEra Energy Operating Partners, LP (NEP OpCo) or its
subsidiaries and is obligated to return these funds only as needed
to cover project costs and distributions or as demanded by NEP
OpCo. NEP's financial condition and ability to make distributions
to its unitholders, as well as its ability to grow distributions in
the future, is highly dependent on NEER's performance of its
obligations to return all or a portion of these funds; NEER's right
of first refusal may adversely affect NEP's ability to consummate
future sales or to obtain favorable sale terms; NextEra Energy
Partners GP, Inc. (NEP GP) and its affiliates may have conflicts of
interest with NEP and have limited duties to NEP and its
unitholders; NEP GP and its affiliates and the directors and
officers of NEP are not restricted in their ability to compete with
NEP, whose business is subject to certain restrictions; NEP may
only terminate the Management Services Agreement among, NEP,
NextEra Energy Management Partners, LP (NEE Management), NEP OpCo
and NextEra Energy Operating Partners GP, LLC under certain limited
circumstances; if the agreements with NEE Management or NEER are
terminated, NEP may be unable to contract with a substitute service
provider on similar terms; NEP's arrangements with NEE limit NEE's
potential liability, and NEP has agreed to indemnify NEE against
claims that it may face in connection with such arrangements, which
may lead NEE to assume greater risks when making decisions relating
to NEP than it otherwise would if acting solely for its own
account; NEP's ability to make distributions to its unitholders
depends on the ability of NEP OpCo to make cash distributions to
its limited partners; if NEP incurs material tax liabilities, NEP's
distributions to its unitholders may be reduced, without any
corresponding reduction in the amount of the IDR fee; holders of
NEP's units may be subject to voting restrictions; NEP's
partnership agreement replaces the fiduciary duties that NEP GP and
NEP's directors and officers might have to holders of its common
units with contractual standards governing their duties and the New
York Stock Exchange does not require a publicly traded limited
partnership like NEP to comply with certain of its corporate
governance requirements; NEP's partnership agreement restricts the
remedies available to holders of NEP's common units for actions
taken by NEP's directors or NEP GP that might otherwise constitute
breaches of fiduciary duties; certain of NEP's actions require the
consent of NEP GP; holders of NEP's common units currently cannot
remove NEP GP without NEE's consent and provisions in NEP's
partnership agreement may discourage or delay an acquisition of NEP
that NEP unitholders may consider favorable; NEE's interest in NEP
GP and the control of NEP GP may be transferred to a third party
without unitholder consent; reimbursements and fees owed to NEP GP
and its affiliates for services provided to NEP or on NEP's behalf
will reduce cash distributions from NEP OpCo and from NEP to NEP's
unitholders, and there are no limits on the amount that NEP OpCo
may be required to pay; increases in interest rates could adversely
impact the price of NEP's common units, NEP's ability to issue
equity or incur debt for acquisitions or other purposes and NEP's
ability to make cash distributions to its unitholders; the
liability of holders of NEP's units, which represent limited
partnership interests in NEP, may not be limited if a court finds
that unitholder action constitutes control of NEP's business;
unitholders may have liability to repay distributions that were
wrongfully distributed to them; the issuance of common units, or
other limited partnership interests, or securities convertible
into, or settleable with, common units, and any subsequent
conversion or settlement, will dilute common unitholders' ownership
in NEP, may decrease the amount of cash available for distribution
for each common unit, will impact the relative voting strength of
outstanding NEP common units and issuance of such securities, or
the possibility of issuance of such securities, as well as the
resale, or possible resale following conversion or settlement, may
result in a decline in the market price for NEP's common units;
NEP's future tax liability may be greater than expected if NEP does
not generate net operating losses (NOLs) sufficient to offset
taxable income or if tax authorities challenge certain of NEP's tax
positions; NEP's ability to use NOLs to offset future income may be
limited; NEP will not have complete control over NEP's tax
decisions; and distributions to unitholders may be taxable as
dividends. NEP discusses these and other risks and uncertainties in
its annual report on Form 10-K for the year ended December 31, 2022 and other Securities and
Exchange Commission (SEC) filings, and this news release should be
read in conjunction with such SEC filings made through the date of
this news release. The forward-looking statements made in this news
release are made only as of the date of this news release and NEP
undertakes no obligation to update any forward-looking
statements.
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SOURCE NextEra Energy Partners, LP