August 14, 2016 Comments (0) Current Investigations

Hi-Crush Partners Announces Public Offering

(Last Updated On: October 14, 2016)

Have you suffered losses investing in Hi-Crush Partners LP? If so, the securities attorneys of The White Law Group may be able to help.

Hi-Crush Partners LP produces and supplies monocrystalline sand in the United States. The monocrystalline sand is a mineral that is used as a propant to enhance the recovery rates of hydrocarbons from oil and natural gas wells. It owns, operates, and develops sand reserves and related excavation and processing facilities.  Hi-Crush Partners MLP was founded in 2012 and is based in Houston, Texas.

Master Limited Partnership (MLP) is a type of limited partnership that is publicly traded. MLP’s receive the same tax benefits of a limited partnership combined with the liquidity of a publically traded security. In order to be classified as an MLP the partnership must receive 90% of its cash flow from a “qualifying source” – such as real estate, natural resources or commodities.

MLP’s are extremely complex and risky. They are only suitable for wealthy, sophisticated retail investors or institutional investors.

Distributions in the Hi-Crush Partners LP came to a halt in Q3 of 2015 and of course the biggest risk to Hi-Crush Partners is energy prices remaining low, or even falling further, and failing to recover sufficiently by early 2017 to reignite demand for frack sand. For more on this, see Update: Hi-Crush Partners, LP.

On August 10th, Hi-Crush Partners LP announced that it has priced a primary public offering of 6,500,000 units representing limited partnership interests in the Partnership for total gross proceeds of approximately $80.3 million. In connection with the offering, the Partnership granted the underwriters a 30-day option to purchase up to an additional 975,000 common units on the same terms.

According to the press release, the Partnership intends to use the net proceeds from this offering to fund a portion of the purchase price of the previously announced acquisition of Hi-Crush Blair LLC.

Brokerage firms that sell such products as Hi-Crush Partners, LP are required to perform adequate due diligence on the investments to ensure a reasonable likelihood of success, and to evaluate whether the investments are suitable in light of the client’s age, net worth, investment experience, and investment objectives. Firms that fail to perform adequate due diligence, or that make unsuitable recommendations, can be held responsible for losses in a FINRA arbitration claim.

If you suffered losses investing in Hi-Crush Partners LP or another MLP and would like a free consultation with a securities attorney, please call The White Law Group at 888-637-5510.

The White Law Group is a national securities arbitration, securities fraud, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida.

For more information on The White Law Group, visit www.whitesecuritieslaw.com.