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Suburban Propane's CEO Discusses Acquisition Of Retail Propane Operations Of Inergy, L.P. (Transcript)

At this time, I’d like to get the call started by turning it over to Mike Dunn, our President and Chief Executive Officer.



Mike Dunn

Thank you, Davin. And good morning and thank you everyone for joining us today. As Davin said, I am Mike Dunn, President and CEO. With me is Mike Stivala, our Chief Financial Officer, and of course, you’ve met Davin vis-a-vis the forward statements.

The agenda for today’s presentation is as follows; take a brief walk through the transaction, an overview of Suburban, an overview of the opportunity, conclusion, and then we’re going to allow some time for questions and answers.

With that said, let’s get into the presentation and I’ll turn it over to Mike Stivala to walk you through the transaction.

Mike Stivala



Thank you Mike, and good morning to everyone. Thank you all for taking the time to join us this morning. On Slide 6, we summarize the transaction structure and some relevant aspects to consider. First, Suburban is purchasing the retail propane business and operations of Inergy, LP for a total consideration of $1.8 billion, subject to certain adjustments. The consideration will be in the form of, one, $600 million of new suburban common units issued to Inergy, the majority of which will be distributed by Inergy to its unit holders. And two, an exchange of certain of Inergy’s existing unsecured senior notes with an aggregate principal amount of $1.2 billion for a combination of up to $1 billion of new Suburban senior notes and up to $200 million of cash. Please refer to the press release issued by us this morning for more information about the exchange.

Suburban intends to issue approximately $250 million of new common units in a secondary public offering subject to market conditions, which we use to fund the cash portion of the exchange, as well as the fees and expenses associated with the transaction and the related transaction financing.

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