Linn Energy (NSDQ: LINE) priced $1.3 billion in 8.625 percent 10-year senior notes at 97.552 percent of par value.

Last week, Linn announced it was looking to price $500 million in 10-year notes along with a secondary offering of units. The partnership will use the proceeds to pay down its revolving credit line and fund acquisitions–including last week’s announced purchase of gas-producing properties in Michigan and this week’s announced deal to acquire oil-producing properties in the Permian Basin.

The bond offering that Linn priced last night was 2.6 times what the company had originally intended, and the company was able to sell the bonds at only a slight discount to par value. The bonds offer a yield to maturity of just over 9 percent, roughly 100 basis points less than the yield on its common units.

This expanded bond offering attests to strong demand from institutional investors, a vote of confidence in the company’s strategic direction and efforts to limit immediate exposure to commodity prices through hedging. 

Linn’s bond financing, coupled with the cash the company is raising via a secondary offering of units, suggests that it will pursue more deals this year. This prospect raises the odds the partnership will boost distributions at some point this year. Buy Linn Energy under 28.