[Context: On August 7, LNG export facility developer NextDecade (Nasdaq: NEXT) sold $50m in convertible preferreds to a group of investors including HGC NEXT INV, LLC, York Capital Management Global Advisors, LLC, Valinor Management, L.P., and Halcyon Capital Management LP. Further details, advisors and related links are below.]
NEXTDECADE | YORK CAPITAL | VALINOR | HALCYON
NextDecade Sells $50 Million of Convertible Preferred Stock
THE WOODLANDS, Texas–August 07, 2018–(BUSINESS WIRE)–NextDecade Corporation (“NextDecade” or the “Company”) (NASDAQ: NEXT) announced today that it has agreed to sell $50 million of convertible preferred stock to HGC NEXT INV, LLC (“HGC”), and to funds and accounts managed by each of York Capital Management Global Advisors, LLC and its affiliates (“York”), Valinor Management, L.P. (“Valinor”), and Halcyon Capital Management LP (“Halcyon”).
HGC, a wholly owned subsidiary of a leading Korean petrochemical company, will invest $35 million, and the Company’s three largest stockholders, York, Valinor, and Halcyon, will invest $15 million pursuant to backstop agreements dated April 11, 2018. These investments will be made in Series A Convertible Preferred Stock (“Series A”) pursuant to the Company’s private offering approved at a Special Meeting of Stockholders on June 15, 2018 (“Special Meeting”).
As part of its investment in NextDecade, HGC will receive one seat on the Company’s board of directors, and will also have the right to contribute up to $350 million of project-level equity upon the final investment decision (FID) of NextDecade’s Rio Grande LNG project.
The Company intends to use the proceeds of the Series A private offering to continue developing its Rio Grande LNG terminal facility and associated pipelines in South Texas and for general corporate purposes and working capital.
During the course of the offering, the Company received expressions of interest for convertible preferred stock in excess of the $50 million authorized at the Special Meeting. At the direction of the Company’s board of directors, management is exploring the merits of these expressions of interest. The Company or any prospective investors may elect not to pursue any additional transactions at this time. Should the Company elect to pursue any transactions in excess of the $50 million authorized at the Special Meeting, the Company would seek stockholder approval for the issuance of additional convertible preferred stock.
Macquarie Capital (USA), Inc. advised the Company on the HGC investment.
About NextDecade Corporation
NextDecade is an LNG development company focused on LNG export projects and associated pipelines in Texas. NextDecade intends to develop a portfolio of LNG projects, including the 27 mtpa Rio Grande LNG export facility in Brownsville, Texas and the 4.5 Bcf/d Rio Bravo Pipeline that would transport natural gas from the Agua Dulce area to Rio Grande LNG. NextDecade’s common stock is listed on the Nasdaq Capital Market under the symbol “NEXT.” NextDecade is headquartered in The Woodlands, Texas.
Located at the Port of Brownsville in South Texas, NextDecade’s Rio Grande LNG project is expected to be a leader among second wave U.S. LNG projects. NextDecade’s customers and shareholders will benefit from the project’s experienced leadership, proven approach, and optimal location. NextDecade’s technology selections will foster operational reliability and afford NextDecade’s customers access to reliable, low-cost, abundant natural gas from the Permian Basin, Eagle Ford Shale, and other basins.