Western Gas Partners LP (NYSE: WES) announced Feb. 28 that it agreed to buy natural gas liquid (NGL) assets from The Woodlands, Texas-based Anadarko Petroleum Corp. (NYSE: APC) for $375 million.
Western Gas, of Houston, will acquire a 20% interest in each of Texas Express Pipeline LLC and Texas Express Gathering LLC and a 33.33% interest in Front Range Pipeline LLC.
"This immediately accretive acquisition marks our entry into the long-haul NGL transportation business, which is a natural complement to our existing portfolio," Don Sinclair, Western Gas CEO, said in the release. "These 100% fee-based assets gather and transport liquids from the Anadarko, Permian, and D-J basins, all of which are recognized as world class resource plays."
The partnership intends to finance the acquisition with borrowings of $350 million from its revolving credit facility, $6 million of cash on hand, and the issuance of 308,490 common units to Anadarko at an implied price of $60.78 per unit.
The terms of the acquisition were unanimously approved by the board of directors of the partnership's general partner and by the board's special committee. The acquisition is expected to close on March 3.
Evercore Partners was financial advisor to the special committee of Western Gas' board. Bracewell and Giuliani LLP was legal advisor to Western Gas.
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