Energy Business

Energy Companies Raising More Cash (BRY, BWEN, KYN, MWE, REXX)

We have already seen a flood of secondary offerings from many companies in many sectors either sold or filed this week.  The strong market is giving many companies a window to raise cash, and we are seeing a specific push from the energy sector in efforts to raise capital.  We have seen formal pricing, pending pricing and/or filings this week from companies like Berry Petroleum Co. (NYSE: BRY), Broadwind Energy Inc. (NASDAQ: BWEN), Kayne Anderson MLP Investment Company (NYSE: KYN), MarkWest Energy Partners LP (NYSE: MWE), and Rex Energy Corp. (NASDAQ: REXX).


Berry Petroleum Co. (NYSE: BRY) is selling some 7 million common shares in an offering expected to price today.  The deal is being brought by Credit Suisse and J.P. Morgan and would be close to $200 million based on current prices.  That compares to a market cap of $1.3 billion and funds are being used for an acquisition.

Broadwind Energy Inc. (NASDAQ: BWEN) is first and foremost NOT an oil and gas company.  It manufactures and sells high precision gears for wind turbines and for other sectors, but we hope one day that alternative energy companies and their suppliers are thought of as energy companies.  The company has been in the process of selling 15 million shares of common stock in an offering through Macquarie and J.P. Morgan.  That would be close to $100 million in proceeds today, versus an implied market cap of $633 million.

Kayne Anderson MLP Investment Company (NYSE: KYN) is technically not an oil company, but it is a closed-end fund that invests at least 85% of its total assets in energy-related master limited partnerships and their affiliates.  It sold 5.5 million shares at $23.61 per share.  This raised approximately $124 million to be used to make additional portfolio investments.  The sale came through UBS Securities, Merrill Lynch, Citi, and Morgan Stanley as joint book-running managers.  This one is even down 6% today on the event.

MarkWest Energy Partners LP (NYSE: MWE) has filed with the SEC its automatic shelf registration for units to sell Common Units (LP interests) and debt securities.  As with many automatic shelf registration statements, no financial terms nor underwriters were named. Its market cap is $1.9 billion.

Rex Energy Corp. (NASDAQ: REXX) is selling some 5.5 million shares in a deal expected to price today after the close through KeyBanc Capital Markets and RBC Capital Markets.  Net proceeds of the offering are intended to fund a portion of Rex Energy’s capital expenditure program for 2010 and for other general corporate purposes.  This would be close to $70 million today versus an implied market cap of $472 million.

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JON C. OGG

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