Overview of the Offering#
Delek Logistics Partners, LP, based in Brentwood, Tennessee, has announced an offering of $800 million in senior notes. These notes carry an interest rate of 6.875% and are set to mature in 2034. The offering is expected to close on May 14, 2026, pending standard closing conditions.
Purpose of the Proceeds#
The funds raised from this offering will primarily be used to repurchase existing debt. Specifically, Delek Logistics plans to buy back all outstanding 7.125% Senior Notes due in 2028 through a tender offer. Additionally, the company will redeem some of its 8.625% Senior Notes due in 2029, which will help manage its total debt of $2.33 billion while maintaining an attractive dividend yield of 8.84%.
Redemption Details#
As part of this financial strategy, Delek Logistics has issued a conditional notice to redeem $400 million of its 2029 notes on May 14, 2026. The redemption price will be 104.313% of the principal amount, plus any accrued interest. This redemption is contingent upon the successful completion of the new notes offering.
Company Background#
Delek Logistics is a midstream energy master limited partnership that provides essential services like gathering, pipeline, and transportation for crude oil and natural gas. Its operations are mainly concentrated in regions such as the Permian Basin and Gulf Coast. The company has a strong track record, having increased its dividend for 13 consecutive years, reflecting its commitment to returning value to shareholders.