K-Sea Transportation Partners, the listed, New Jersey-based shipping company, will get up to $100 million from KA First Reserve, a partnership investment coming from private equity firms First Reserve and Kayne Anderson Capital Advisors.

The investors will get 18.4 million preferred shares of stock in exchange for their investment; $85 million will come immediately and the additional $15 million will come within 30 days. In what amounts to a distressed PIPE transaction, K-Sea said it will use its proceeds from the deal to repay some of its debt. The company has long-term debt of more than $350 million.

As a part of the deal, KA First Reserve will designate Gary Reaves of First Reserve and Kevin McCarthy and Jim Baker of Kayne Anderson to join K-Sea’s board, which will be expanded to include new members.

K-Sea also postponed the announcement of its quarterly financial results as it works with lenders to extend a waiver. For the prior quarter, K-Sea reported losses of $11 million; the company has made asset sales to support its core operations.

K-Sea also amended its debt covenants and cut lenders' commitments to $115 million from $175 million. The company operates tank barges that transport refined petroleum products on contracts with companies including BP, ConocoPhillips and ExxonMobil.

In 2005, K-Sea raised $16 million through a separate private placement of common shares.

First Reserve is investing from its First Reserve XI Fund, a multi-billion dollar fund the typically large-cap investor raised in 2006. In May, the private equity firm also announced plans with MEMC Co.’s SunEdison to establish a joint venture with $1.5 billion cap that will pursue investments in solar photovoltaic energy products.

Last July, Kayne Anderson Capital Advisors closed its fifth energy private equity fund with total commitments of $820 million.

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