Summit Midstream Partners LP (NYSE: SMLP) announced March 18 it closed the drop down acquisition of Red Rock Gathering Co. for $305 million.
Grand River Gathering LLC, Dallas-based SMLP's wholly owned subsidiary, agreed to buy 100% of the equity interests in Red Rock from a subsidiary of Summit Midstream Partners LLC ("Summit Investments") in a drop down acquisition, which is when a corporation sells purchased assets to a partnership.
Summit Investments acquired the Red Rock system in October 2012. Red Rock is a natural gas gathering and processing system located in the Piceance Basin in western Colorado and eastern Utah.
The drop down was financed with the net proceeds from SMLP's primary equity offering of 5.3 million common units and borrowings under its revolving credit facility.
Evercore Partners was independent financial advisor to SMLP board's conflicts committee. Akin Gump Strauss Hauer & Feld LLP was legal advisor.
Recommended Reading
E&P Highlights: June 5, 2023
2023-06-05 - Here’s a roundup of the latest E&P headlines in the upstream oil and gas industry, including wells offshore Congo beginning production and approval for a North Sea field development.
Mexico Authorizes Exports from Altamira Fast LNG Project
2023-06-05 - Mexico’s Energy Secretariat issued an export permit to New Fortress Energy Inc. for its Altamira fast liquefaction facility slated to start LNG operations in third-quarter 2023.
Exclusive: VTX Energy Adds More Southern Delaware Acreage, CEO Says
2023-06-05 - VTX Energy Partners, backed by Swiss energy trader Vitol, is expanding its southern Delaware Basin footprint to 47,000 net acres through a bolt-on acquisition, CEO Shepherd says.
Crestwood Publishes Fifth Annual Sustainability Report
2023-06-05 - Crestwood Equity Partners’ sustainability report highlights the company’s progress in achieving its ESG and sustainability goals.
Range Declares Quarterly Dividend
2023-06-05 - Range Resources’ board of directors declared an $0.08 per share quarterly cash dividend on common stock for the second quarter.