AmeriGas' $32MM Senior Notes Rated 'BB+' by Fitch Ratings.

Business Editors

NEW YORK--(BUSINESS WIRE)--April 11, 2003

AmeriGas Partners, L.P.'s (AmeriGas) $32 million 8.875% senior notes due 2011, issued jointly and severally with its special purpose financing subsidiary AP Eagle Finance Corp., are rated 'BB+' by Fitch Ratings. The Rating Outlook is Stable. An indirect subsidiary of UGI Corp. is the general partner and a 51% limited partner for AmeriGas. AmeriGas in turn is a master limited partnership (MLP) for AmeriGas Propane, L.P., an operating limited partnership (OLP). Proceeds from the new senior notes will be utilized to make a capital contribution to the OLP which in turn will use the funds as well as existing cash on hand to repay approximately $53.8 million of maturing debt.

AmeriGas' rating reflects the subordination of its debt obligations to $577 million secured debt of the OLP including the OLP's $540 million privately placed 'BBB' rated first mortgage notes. In addition, Fitch's assessment incorporates the underlying strength of AmeriGas' retail propane distribution network. AmeriGas is viewed as one of the premier retail propane distributors evidenced by its efficient operations, favorable acquisition track record, and proven ability to sustain gross profit margins under various operating conditions. AmeriGas is the nation's largest retail propane distributor with retail sales volumes of more than 900 million gallons annually and a geographically diverse base of more than 1.2 million customers in 46 states. Primary industry concerns are the negative impact of warm heating-season weather on profits and volumes sold and the potential adverse impact of supply price volatility where rapid increases in the wholesale price of propane may not be immediately passed through to customers.

Weather across APU's service territory has been slightly colder than normal during the 2002-2003 winter heating season, a factor which has favorably impacted APU's credit measures. Fitch expects that consolidated ratios for earnings before interest, taxes, depreciation, and amortization (EBITDA) coverage of interest and debt to EBITDA for fiscal year 2003 will approximate 2.8 times (x) and 3.7x, respectively. This compares with EBITDA to interest of 2.4x and total debt to EBITDA of 4.6x for the fiscal year ended Sept. 30, 2002, a period during which AmeriGas experienced weather that was 10% warmer than normal. In addition, cash distributions to AmeriGas, which can be generally defined as EBITDA generated by the OLP minus OLP interest expense and maintenance capital expenditures, should cover interest expense on AmeriGas' outstanding senior notes by more than 4.5x during fiscal year 2003.

Fitch believes that conditions and/or events that would disrupt debt service at AmeriGas remain highly unlikely. Specifically, Fitch estimates that EBITDA at the OLP would have to drop by more than 40% under a warm weather stress case scenario before the OLP could potentially be restricted from distributing cash to AmeriGas. The likelihood of this level of EBITDA erosion is remote given AmeriGas' strong track record of customer retention and demonstrated ability to maintain unit margins even during periods of extreme product price volatility.