Crestwood Equity Partners LP has announced the closing of Delaware Basin acquisitions of Sendero Midstream Partners LP for approximately US$600 million in cash and First Reserve’s 50% interest in Crestwood Permian Basin Holdings LLC (CPJV) for 11.3 million Crestwood common units (equivalent to US$320 million). Additionally, on July 1, 2022, Crestwood completed the divestiture of its Barnett Shale assets for US$275 million in cash.
- The first transaction involves the acquisition of Sendero Midstream assets, located in Eddy County, New Mexico for US$600 million. The assets are comprised of 350 MMcf/d of processing capacity with approximately 140 miles of natural gas gathering lines and more than 53,000 horsepower of field gathering compression
- In the second transaction, Crestwood acquired 50% equity interest in CPJV for US$320 million. As part of the valuation and a condition to closing the transaction, First Reserve funded US$75 million into CPJV to pay down asset-level debt and support a portion of the cash consideration due to Sendero Midstream. In connection with these steps, Crestwood has issued to First Reserve approximately 11.3 million common units, which represents a total transaction value of US$320 million.
- The divestment transaction consists of selling non-core Barnett Shale assets of Crestwood equity partners to EnLink Midstream for US$275 million in cash. The assets include the Alliance System, the Lake Arlington System and the Cowtown System. Crestwood utilized the cash proceeds from the sale to fund the cash consideration for the Sendero Midstream acquisition.
RBC Capital Markets served as a lead financial advisor, Citi served as financial advisor and Vinson & Elkins L.L.P. and Locke Lord L.L.P. served as legal advisors to Crestwood. Morgan Stanley & Co. LLC served as financial advisor and Latham & Watkins LLP served as legal advisor to Sendero Midstream. Simpson Thacher & Bartlett L.L.P. served as legal advisor to First Reserve. Baker Botts L.L.P. served as advisor to EnLink Midstream.