Regency Raises Capital To Expand Haynesville Stake

DALLAS (AP) — Natural gas distributor Regency Energy Partners LP on Thursday said it issued $80 million series A convertible preferred units and will use most of the proceeds to expand its stake in a joint venture project in the Haynesville Shale.

Regency said it plans to use $63 million of the net proceeds to buy an extra 5 percent ownership interest in the Haynesville project from an affiliate of GE Energy Financial Services. The move would bring Regency's ownership to 43 percent. The GE affiliate will retain a 7 percent partnership interest.

The units were priced at $18.30 each, pay a fixed quarterly distribution of 44.5 cents per unit and are convertible into common units on a one-for-one basis after six months.

Regency said it plans to use the balance of the offering's proceeds to fund ongoing, fee-based growth projects and further strengthen its position in the Haynesville Shale.

The issuance of units was led by MTP Energy Management and Harvest Partners.

Shares of the company rose 92 cents, or 6 percent, to $16.31 in afternoon trading.