Finance

Delek Logistics Announces Common Unit Public Offering and Outlines Use of Proceeds

BRENTWOOD, Tenn., March 7, 2024 /PRNewswire/ -- In a significant financial move, Delek Logistics Partners, LP, known on the New York Stock Exchange by its ticker DKL, has publicly communicated its decision regarding the pricing of a substantial underwritten public offering. The company has priced the public offering of 3,116,884 common units, representing limited partner interests, at a price of $38.50 per unit. This pricing decision has been disclosed as part of Delek Logistics' compliance with a previously submitted and effective shelf registration statement with the Securities and Exchange Commission (SEC). Further details concerning the offering are available in a preliminary prospectus supplement that Delek Logistics has filed with the SEC.

In a strategic move, Delek Logistics has presented the underwriters with a 30-day option that allows them to purchase up to an additional 467,532 common units. The intent behind the offering, including the possible exercise of the purchase option by the underwriters, is for Delek Logistics to utilize the net proceeds to repay outstanding borrowings under its revolving credit facility.

It is important to note that Delek US Holdings, Inc. ("Delek Holdings"), will not be acquiring any of the common units on offer. Given this allotment scenario, post-offering, Delek Holdings' stake in the outstanding Delek Logistics common units will experience a reduction from the pre-offering position of 78.7% to roughly 73.4%.

The completion of this offering is projected to take place on March 12, 2024, with the closure contingent upon the fulfilment of customary closing conditions. As the transaction progresses, it is expected to settle in alignment with typical underwriting procedures.

A syndicate of financial institutions is steering the offering, with Truist Securities, BofA Securities, and Raymond James serving as joint book-running managers. The preliminary prospectus supplement along with the accompanying base prospectus that are relevant to this offering are obtainable from any of the managing underwriters.

Truist Securities can be reached at their Atlanta, Georgia location, BofA Securities can be contacted at their headquarters in Charlotte, North Carolina, and Raymond James has provided their contact details for their office based in St. Petersburg, Florida. Each of these institutions is facilitating access to the pertinent documents via requests by mail or email, ensuring prospective investors can avail themselves of the necessary information. Furthermore, the documents are also freely accessible on the SEC’s website (www.sec.gov) whenever they are available.

The distribution of this press release serves exclusively as a channel to inform and is not to be misconstrued as an overt offer to sell or a solicitation for an offer to purchase securities. Moreover, it should be noted that there can be no sale of these securities in any jurisdiction or state where such offer, solicitation or sale would be prohibited prior to the registration or qualification under the securities laws of any such jurisdiction or state. The conduct of the offering is subject to the stipulations laid out by a prospectus and its corresponding supplement, both of which fulfill the requirements defined in Section 10 of the Securities Act of 1933, as amended (known as the "Securities Act").

Unveiling Delek Logistics Partners, LP

Delek Logistics is a midstream energy master limited partnership with its headquarters strategically situated in Brentwood, Tennessee. The organization's extensive asset portfolio includes owned and joint ventured assets primarily situated in and around the Permian and Delaware Basins, as well as specific locations in the Gulf Coast region. The partnership provides a suite of essential services, ranging from gathering, transportation, and pipeline to intermediary functions alongside services for crude oil, natural gas, refined products, storage, wholesale marketing, terminalling, water disposal, and recycling.

The relationship between Delek Holdings and Delek Logistics is notably symbiotic. Delek Holdings, which trades on the NYSE under the ticker DK, not only owns the general partner interest and a controlling limited partner interest in Delek Logistics but also ranks as a noteworthy customer to the partnership.

Looking Ahead: Forward-Looking Statements

This press release contains forward-looking statements that anticipate future events or developments, including statements regarding the anticipated closing of the offering and the intended allocation of the net proceeds. These forward-looking statements are characterized by the use of terms like "possible," "believe," "may," and other similar expressions that indicate projections and anticipations about future events. These statements, which also often employ the future tense, were established at the initial date of issuance and are supported by existing expectations, forecasts, estimates, and the deeply held beliefs and assumptions of our management team.

The forward-looking statements hold the potential for a significant degree of risk and uncertainty. Delek Logistics would like to caution that its actual future results could show a material difference from the results predicted or implied in these statements because of various factors, including those that are external to the company's control. Market risks and uncertainties bearing on the offering and external events such as natural disasters or public health crises could significantly impact the anticipated outcomes.

To acquire a fuller comprehension of the potential risks and uncertainties that could cause our actual business results to diverge from our forward-looking statements, Delek Logistics urges interested parties to consult its documents filed with the SEC. This includes detailed reports such as the Delek Logistics' Annual Report on Form 10-K for the year that concluded on December 31, 2023, among others. These filings not only provide a historical perspective on Delek's business achievements but also a nuanced view of potential future risks and operational uncertainties.

Final Note

Delek Logistics Partners, LP takes pride in maintaining transparency and providing stakeholders with the latest information on its operational and financial initiatives. This press release serves as a culminating point for the recent announcements and future-centric strategies by the company.

This significant public offering by Delek Logistics serves as yet another testament to the company’s strategic financial management and commitment to responsible stewardship of investor interests. With a clear-cut plan for utilizing the generated capital and a robust service portfolio that underpins the energy sector's infrastructure, Delek Logistics continues to exemplify industry leadership and fiscal prudence.

Stakeholders and prospective investors are encouraged to remain abreast of Delek Logistics' future filings and reports with the SEC, as these documents provide a detailed and regulatory-compliant discourse on the company’s market strategies, financial performance, and projected growth trajectories.

For more information or inquiries specifically related to the offering detailed in this press release, interested parties can refer to the correspondence details provided earlier for the joint book-running managers or visit the SEC’s website, with the acknowledgment that the availability of certain documents may be subject to regulatory release schedules and customary legal processes.

In conclusion, Delek Logistics Partners, LP stands poised to continue its trajectory of growth and value creation, underpinned by its latest financial undertakings and a profound understanding of the energy sector's ever-evolving landscape. As the company forges ahead with its strategic objectives and operational endeavors, the investment community watches on with keen interest, poised to witness the unfolding of a new chapter in Delek's corporate history.

The anticipated closing of the offering, subject to standard procedural requirements, marks an instrumental step in reinforcing Delek Logistics' financial foundation, which supports its ability to offer an integrated suite of midstream energy services. Such moves underscore Delek's commitment to efficient capital management, further solidifying its standing in the financial markets and the energy sector.

As Delek Logistics Partners, LP continues to navigate through the complexities of the market and the demands of energy infrastructure, its actions in the financial arena will remain a focal point for analysis by investors and industry pundits alike. The detailed dissemination of information through press releases such as this one is part of Delek Logistics’ dedication to corporate transparency and engagement with the wider financial community.

The proactive approach in communicating with stakeholders, while aligning strategic financial procedures with long-term business objectives, defines the essence of Delek Logistics Partners, LP's business philosophy. As the partnership moves forward, it aims to sustain its position as a key player in the energy sector, fortified by a strategic financial vision and resilient operational capabilities.

Delek Logistics Partners, LP is a publicly-traded master limited partnership engaged in the storage, transport, and wholesale marketing of petroleum and related products. The partnership is a leading provider of critical infrastructure for the energy industry, and its recent financial initiatives reflect its enduring commitment to maintaining a healthy and strategic balance sheet while delivering value to its shareholders and supporting the energy needs of its diverse clientele.

For further transparency and facilitation of information access, all regulatory filings and financial disclosures by Delek Logistics Partners, LP can be found on the company's website and the SEC's official platform.

This press release constitutes a public disclosure by Delek Logistics Partners, LP and is sourced directly from the company.