Business Context and Reporting Period
Company: Black Hills Corporation
Filing Type: Form 8-K (Current Report)
Date of Report: May 11, 2009
Event: Entry into a Material Definitive Agreement for an underwritten public offering of debt securities.
Key Financial Metrics
- Debt Issuance: $250 million aggregate principal amount of 9% notes due 2014.
- Existing Debt Facility: $383 million acquisition credit facility with The Royal Bank of Scotland Group (expires December 29, 2009).
- Use of Proceeds: Repayment of a portion of borrowings under the acquisition credit facility.
- Revenue/Profit/Cash Flow: The filing text does not provide a clear value for revenue, profit, cash flow, or margins.
- Liquidity: The filing text does not provide a clear value for current liquidity ratios or cash balances.
Material Changes
This filing represents a material change in the Company's capital structure through the execution of an underwriting agreement. The Company intends to refinance a portion of its short-term acquisition debt (related to the purchase of Aquila, Inc.'s regulated utilities) with long-term fixed-rate notes.
Guidance, Outlook, and Risks
- Closing Date: Expected on May 14, 2009, subject to customary closing conditions.
- Underwriters: Credit Suisse Securities (USA) LLC and RBS Securities Inc.
- Registration: Notes registered under the Company's existing shelf registration statement (File No. 333-150669).
- Risks/Contingencies: The offering is contingent on the satisfaction of customary closing conditions. The filing explicitly states it does not constitute an offer to sell securities in jurisdictions where such an offer would be unlawful.
Investor Verification Checklist
- Confirm the final closing of the $250 million offering on or around May 14, 2009.
- Verify the exact amount of the acquisition credit facility repaid with the net proceeds.
- Review the full Underwriting Agreement (Exhibit 1) for specific covenants and redemption terms.
- Check subsequent filings for the impact of the new 9% interest rate on future interest expense.