Foresight Energy LP

29 Mar 2017capital raising announcement● NeutralMajor

On March 28, 2017 Foresight completed the refinancing of its second-lien PIK notes, exchangeable PIK notes and old bank facilities using $425.0 million of new second-priority notes due 2023, a new $825.0 million term loan, a $170.0 million revolver (undrawn apart from letters of credit), the Murray Investment and cash. Murray Energy bought 9,628,108 new common units for $60.6 million, which repaid the $54.5 million of second-lien notes on March 27. The company then called the remaining second-lien notes for redemption on April 27, 2017 and deposited the cash, discharging them. This resolves the exchangeable-note threat of converting into 75% of the units (the filing says the exchangeable notes were refinanced) and the Feb 24 conditional redemption; the new Murray units dilute existing unitholders (inference).

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24 Feb 2017capital raising announcement● NeutralMajor

On February 24, 2017 Foresight's issuers gave a conditional notice to redeem $54.5 million of the second-lien PIK notes due 2021 at 110% of principal plus accrued interest, targeted for March 27, 2017 (may be delayed). It happens only if an equity offering raises enough cash and a new senior secured debt offering is priced. If completed, $296.2 million of the notes would remain outstanding. The filing does not say how large the equity offering would be or who would buy it.

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6 Sept 2016capital raising announcement● NeutralMajor

On August 30, 2016 Foresight completed its global restructuring. It exchanged $599.825 million of 7.875% notes (including $105.354 million bought by Reserves in a tender offer) for $349.1 million of second-lien PIK notes due 2021, $299.859 million of exchangeable PIK notes and 516,825 warrants. The exchangeable notes bear 15% PIK interest and mature October 3, 2017; if not repaid in cash or bought (Murray Energy has a purchase right) by then, they convert into 75% of units, a heavy dilution risk for current unitholders. The filing says the restructuring eased the defaults tied to the 2015 change-of-control litigation, which has been dismissed with prejudice. This resolves the exchange, tender and forbearance threads, but the dilution risk remains open. Unitholders keep their units for now (inference: not an ending of their position).

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