Dallas-based Energy Transfer LP has agreed to acquire Houston-based Crestwood Equity Partners in an all-equity transaction valued at roughly $7.1 billion.
Included in the deal is the assumption of $3.3 billion of debt, based on the closing price on Aug. 15, Energy Transfer said. The deal is expected to close in the fourth quarter.
Upon closing, Energy Transfer said that Crestwood common unitholders are expected to own roughly 6.5% of Energy Transfer’s outstanding common units.
Crestwood is a publicly traded master limited partnership that owns and operates midstream assets primarily in the Williston Basin, Delaware Basin, and Powder River Basin, including roughly 2 billion cubic feet per day of gas gathering capacity, 1.4 billion cubic feet per day of gas processing capacity, and 340,000 barrels per day of crude gathering capacity.
Energy Transfer said that if consummated, the deal would extend its position in the value chain deeper into the Williston and Delaware basins while also providing entry into the Powder River basin.
It said those assets should complement its downstream fractionation capacity at Mont Belvieu, as well as its hydrocarbon export capabilities from both its Nederland Terminal in Texas and the Marcus Hook Terminal in Philadelphia, Pennsylvania.
The deal also should provide benefits to Energy Transfer’s NGL & Refined Products and Crude Oil businesses with the addition of strategically located storage and terminal assets, including roughly 10 million barrels of storage capacity, as well as trucking and rail terminals.
BofA Securities was sole financial adviser to Energy Transfer and Kirkland & Ellis LLP acted as legal counsel. Intrepid Partners LLC and Evercore were financial advisers to Crestwood, and Vinson & Elkins LLP was legal counsel.
In May, the University of Texas at Arlington announced that Energy Transfer Executive Chairman and Chairman of the board Kelcy Warren made a $12 million gift to help elevate UTA to the forefront of the growing resource and energy engineering (REE) field.
The funding will be used to fuel faculty and research excellence in the College of Engineering’s new REE bachelor’s degree program “while providing students with life-changing opportunities for educational and career success in REE and beyond,” the university said.
“I am honored to give back to the institution that has played such a pivotal role in advancing my educational and professional journeys,” Warren, who graduated from UTA in 1978 with a BS in civil engineering, said in a statement. “Texas faces a critical need for highly skilled graduates who can manage energy resources, and this innovative REE program will help meet that demand.”
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