Delek Logistics Partners, LP Announces $120M Proposed Public Offering Of Common Units
Portfolio Pulse from Happy Mohamed
Delek Logistics Partners, LP (DKL) has initiated a public offering of $120M in common units under an existing SEC registration, with an option for underwriters to buy an additional $13.5M. The proceeds are intended for repaying debts under its revolving credit agreement. Delek US Holdings, the sponsor and owner of DKL's general partner, expressed interest in purchasing up to $30M of the units, though this is not a binding commitment.
March 07, 2024 | 9:39 pm
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Delek Logistics Partners, LP announces a $120M public offering of common units to repay outstanding borrowings, with a potential additional purchase by Delek US Holdings.
The public offering could dilute current shareholders' stakes, potentially putting downward pressure on DKL's stock price in the short term. However, the use of proceeds to repay debt is generally viewed positively as it strengthens the balance sheet. The interest from Delek US Holdings indicates strong insider confidence, which could counterbalance the dilutive effect.
CONFIDENCE 90
IMPORTANCE 75
RELEVANCE 100