The New Year ushered in a good amount of dealmaking for Texas lawyers, with 92 of them from 12 different law firms and in-house legal teams pulling off 12 transactions worth $16.5 billion. That’s up from 10 transactions worth $2.5 billion the previous week.
The big value total was skewed by Dominion Energy’s $14.6 billion purchase of Scana, which involved one lawyer from McGuireWoods’ Houston office.
The rest of the deals was a smattering of midstream transactions, private equity investments and oil and gas asset sales with a steel deal and a computer content delivery and storage acquisition thrown in. Below are the past week’s deals – plus a few that hadn’t been reported before the new year dawned.
McGuireWoods advises Dominion on $14.6B Scana purchase
The first mega transaction of 2018 came just days into the new year with Dominion Energy’s Jan. 3 agreement to purchase Scana for $14.6 billion, and McGuireWoods’ Houston office grabbing a piece of the work around it.
Jay Hughes, who replaced Tom Farrell in August as managing partner of the firm’s Houston office, worked on the transaction. He previously was on the team that advised Richmond, Va.-based Dominion on its $4.4 billion acquisition of Questar in 2016.
Mayer Brown counseled Scana with attorneys outside of Texas.
The deal was a bit complicated. While it was a traditional all-stock transaction, it included several sweeteners for Scana customers who had paid for a failed nuclear project through their monthly rates. The incentives include a $1.3 billion cash payment, or about $1,000 on average to each customer, and a 5 percent rate reduction, or about $7 per month on average. Dominion also will write off more than $1.7 billion in connection with the abandoned plant.
The deal is set to close this year if it clears Scana shareholders and regulators, who may exert some pushback to gain more benefits for ratepayers.
McGuireWoods’ Hughes hails from Virginia and was named partner in 2013 when he was still working in the firm’s Richmond office. He has concentrated his practice on the energy sector, with a particular focus on oil and gas, solar and wind energy sources, and regularly advises energy companies on acquisitions and dispositions, joint ventures and project development.
McGuireWoods moved into Houston in 2011 after its merger with Nickens Keeton Lawless Farrell & Flack. At the time, David Ronn and Peter del Vecchio – both previously of Greenberg Traurig – joined the firm as partners in its energy group but since then have moved to other firms—Ronn to Orrick; del Vecchio to Andrews Kurth and later, to Baker Botts.
Akin, Bracewell, Latham work on $607M Archrock deal
Natural gas compression services provider Archrock said Jan. 2 it agreed to acquire the shares it didn’t already own of Archrock Partners for $607 million in stock, and three law firms in Texas benefited from the work.
The conflicts committee of the board of Archrock Partners’ general partner, Archrock GP, enlisted advice from Akin Gump Strauss Hauer & Feld, including partners John Goodgame, Lisa Hearn and Alison Chen and associates Chase Armbrust and Allyson Li, all of Houston. Morris, Nichols, Arsht & Tunnell weighed in from Delaware.
Bracewell counseled investment bank Evercore, which provided financial advice to the conflicts committee. The team included partner Will Anderson and associate Benjamin J. Martin in Houston.
Latham & Watkins partner Ryan Maierson and associate Nick S. Dhesi in Houston advised Houston-based Archrock, which used Citi as its financial adviser. Other Houston team members were associates Samatha Seley, Daniel Harrist and Andrew Tengler-West and tax partner Timothy Fenn and tax associate Jim Cole. Attorneys from the firm’s Washington, D.C., San Francisco and Orange County offices assisted on environmental and benefits matters.
Archrock’s general counsel is Stephanie Hildebrandt, who was a partner in the Houston office of Norton Rose Fulbright before joining the company in August. Before that the Tulane-trained attorney was general counsel of Enterprise Products Partners.
The deal has to clear shareholders, but should close in the second quarter. Company management believes the combination will enhance its cash available for dividend coverage, improve its overall credit profile and simplify its capital structure. The move may also lower its cost of capital, better position it to invest in growth projects and reduce its need for equity capital.
Akin Gump Advises Commercial Metals on $600M rebar acquisition
Akin Gump was involved in another big deal the first week of 2018, announcing Jan. 3 that it advised Irving-based Commercial Metals on its purchase of U.S. rebar steel mill and fabrication assets from Brazil’s Gerdau for $600 million in cash.
The mostly Dallas deal team was led by corporate partners Garrett DeVries and Thomas Yang and included corporate counsel Nicholas Houpt and associates Alex Poor and Stephanie Calderon. Partner John Allen Bain and associate Alex Agahzadeh helped on real estate matters, while partner Alison Chen in Houston assisted on tax.
The firm also tapped its New York, Los Angeles and Washington, D.C. offices for help on tax, environmental and regulatory matters.
Paul Kirkpatrick is Commercial Metals’ general counsel. Before joining the company in 2009 as assistant general counsel, the SMU-educated lawyer was a senior attorney at Haynes and Boone in Dallas.
The purchase included 33 rebar fabrication facilities in the U.S. as well as steel mills in Knoxville, Tenn.; Jacksonville, Fla.; Sayreville, N.J.; and Rancho Cucamonga, Calif. Commercial Metals will have around 7.2 million tons of global melt capacity once the transaction closes, which is expected by year-end.
V&E, Weil advise on $475M Magnetar, EIG investment in CrownRock
Vinson & Elkins said Jan. 4 it advised CrownRock Holdings on a $475 million perpetual preferred equity investment from funds managed by Magnetar Capital and EIG Global Energy Partners.
CrownRock Holdings is an oil and gas producing joint venture of CrownQuest Operating and private equity firm Lime Rock Partners.
The V&E team included several Texas attorneys, including partner Robert Kimball and associates Desi Baca and Grace-Ann Whiteside in Dallas and Houston partner John Lynch on tax.
Weil’s Dallas office advised Magnetar and EIG. The team included corporate partner Rodney Moore, counsel Kevin Crews and associates Anne Moretti Langford and Camille Walker; tax partner Jonathan Macke and associate Adam Arikat; banking and finance partner Courtney Marcus and associate Brendan Conley; and real estate attorney Leslie Smith.
Jefferies was lead financial adviser and Credit Suisse was financial advisor to CrownRock and Lime Rock on the transaction.
CrownRock Holdings, a newly formed company in Midland that owns CrownRock LP, announced the deal Jan. 4. Management said the investment will help support Lime Rock and CrownQuest’s longer-term growth objectives for the company.
Gibson Dunn, Baker Botts aid on $86M Penn Virginia pick-up from Hunt Oil
Houston oil and gas explorer and producer Penn Virginia said Jan. 2 it agreed to acquire assets in South Texas’ Eagle Ford Shale, primarily in Gonzales and Lavaca Counties, from Hunt Oil for $86 million in cash.
Gibson Dunn advised Penn Virginia with a team that included corporate partner Justin T. Stolte and associates David Cias and Graham Valenta in Houston. They had help from tax partner David Sinak in Dallas and an attorney in its San Francisco office on environmental issues.
Katie Ryan is Penn Virginia’s general counsel. Before coming on board in 2014, the University of Houston-trained lawyer was an associate at Baker Botts in Houston.
Baker Botts represented Hunt, including partner Mike Bengtson, who offices out of New York and Austin, and associates Erin Hopkins and Ryan Staine in Houston. Hunt’s in-house counsel was assistant general counsel Curtis Riddle in Dallas, who also cut his legal teeth at Baker Botts.
Penn Virginia CEO and president John A. Brooks said in a statement that the bolt-on acquisition is “an excellent fit at an attractive price” and will increase its core leasehold position by 13 percent and its drilling inventory by 17 percent.
Management expects the deal to close on or before March 1 and fund it with borrowings under its $237.5 million credit facility, which the company is discussing raising with its bank lending group.
AKK advises Newpark on $75M purchase of Well Service
Andrews Kurth Kenyon said Jan. 3 it advised Newpark Resources on its purchase of almost all of the assets and operations of Pennsylvania-based Well Service Group and its affiliate Utility Access Solutions for $75 million.
The deal was announced Oct. 31 and closed Nov. 13. The price included $43 million in cash and $32 million in shares. The target has about $65 million in annual sales.
The AKK team included partner Bill McDonald in the Woodlands and partners Phil Haines and Matt Grunert in Houston, senior associate Micala Bernardo in Dallas and associate Amanda Thienpont in Houston.
Newpark’s general counsel is Mark Airola, who joined in 2006 after serving as assistant general counsel at BJ Services and senior litigation counsel at Cooper Industries. He received his law degree from the University of Houston in 1984.
AKK represents Concurrent Computer on its $29M asset sale to Vecima
AKK also announced Jan. 2 that it advised Atlanta-based Concurrent Computer on the sale of all of the assets of its content delivery and storage business to Canada’s Vecima Networks for $29 million. The transaction was announced Oct. 16 and closed Dec. 31.
The deal was led by attorneys out of AKK’s New York office but had support from partners Russ Denton in Austin and Tony Eppert in Houston and associates Matt Wade in Dallas, Emily Cabrera in the Woodlands and Todd Mobley in Dallas.
The business generated sales of $27.6 million for the 12 months ending June 30 and employs 100. Vecima expects the addition will generate $5.5 million in annual earnings.
Baker Botts, Bracewell, Latham counsel on CNX amendment
CNX Midstream Partners said Jan. 3 that its board authorized it to amend its gas gathering agreement with CNX Resources unit CNX Gas and three law firms in Texas helped make it happen.
Baker Botts lawyers in Houston assisted the conflicts committee, including partner Josh Davidson, senior associate Scott Looper, partner Mike Bresson and associate Leslie Daniel. Bracewell represented investment bank Evercore, which provided financial advice to the committee, including partner Will Anderson and associate Benjamin J. Martin in Houston.
Latham & Watkins was outside legal adviser to CNX Resources, which used Goldman Sachs as its financial adviser. The Latham team in Houston included oil and gas partner Jeff Munoz and associate Michael Sellner; partner William Finnegan and associates Nick Dhesi and Daniel Harrist on capital markets; partner Craig Kornreich and Catherine Ozdogan on finance; and partner Tim Fenn and associate Jim Cole on tax. Attorneys from the firm’s Washington, D.C. office also pitched in.
The amendment is related to CNX’s closing of its previously announced $305 million acquisition of Noble Energy’s 50 percent membership interest in Cone Gathering, which held the general partner interest and incentive distribution rights in Cone Midstream Partners. Cone was renamed CNX Midstream Partners and began trading on the New York Stock Exchange under the ticker symbol “CNXM.”
The amendment is expected to help Pittsburgh-based CNX unlock the value of its southwest Pennsylvania oil and gas properties and capitalize on economies of scale, which would support accelerating drilling activity and production moving forward. CNX Midstream believes the move will result in a higher level of confidence to support sustainable distribution growth, which in turn will benefit 21.7 million unit holder CNX.
V&E counsels Enviva on joint venture with John Hancock Life affiliates
Vinson & Elkins said Jan. 2 it advised Enviva Holdings unit Enviva Development Holdings on its new joint venture, Enviva JV Development, with affiliates of John Hancock Life Insurance. Terms weren’t disclosed.
The venture aims to acquire, develop and construct wood pellet production plants and deepwater marine terminals in the southeastern U.S. It’s already agreed to buy a wood pellet production plant in Greenwood, S.C., from an unnamed buyer for an undisclosed sum.
The V&E team on the joint venture and the acquisition was led by a partner in its New York office.
Assistance on the joint venture was provided by tax partner David Peck in Dallas and associate Neil Clausen in Houston.
Assistance on the acquisition came from senior associate Brittany Sakowitz; partners Jason McIntosh and Ryan Carney on tax; partner Sean Becker on labor/employment in Houston; partner Stephen Jacobson and associate Gina Hancock on executive compensation/benefits; counsel Scot Dixon and Prentiss Cutshaw on real estate; and partner Mark Spradling and associate Luke Edney on energy transactions/projects. All are in Houston except Hancock and Cutshaw, who are in Dallas.
The joint venture will be managed by Enviva Holdings and supported by the Hancock Renewable Energy Group, a unit of the Hancock Natural Resource Group.
Jones Day advised on sale of Rangeland Energy II to Andeavor unit
Jones Day said Jan. 3 that it advised Sugar Land-based Rangeland Energy and its backer EnCap Flatrock Midstream on their sale of Rangeland Energy II to Tesoro Refining & Marketing, a unit of Andeavor, for an undisclosed sum. Partner Omar Samji in Houston led the deal team.
Thompson & Knight was legal counsel to EnCap Flatrock with partner Sarah E. McLean of Austin and Houston in the lead role.
McGuireWoods provided legal counsel to Andeavor out of its Pittsburgh and Chicago offices.
Andeavor’s general counsel is Kim K.W. Rucker, who joined the San Antonio-based company in 2016. The Harvard-educated lawyer previously worked as general counsel at Kraft Foods and Avon Products, in legal positions at Energy Future Holdings and Kimberly-Clark and as a corporate partner at Sidley Austin in Chicago.
Rangeland II owns and operates the Rio System, a multipart crude oil and frac sand logistics system originating in the Delaware Basin. The system provides access and optionality to multiple crude oil producers and end markets.
The all-cash transaction is expected to close early in the first quarter if it clears regulators. Almost all of Rangeland II’s field employees will be offered jobs at Andeavor.
The Rangeland II management team will now focus on the expansion of Rangeland Energy III, which is developing the hydrocarbon logistics terminal South Texas Energy Products System in Corpus Christi and pursuing midstream opportunities in western Canada.
Winston, V&E advise on Gryphon funding from Saudi Aramco, CSL
CSL Capital Management-backed Gryphon Oilfield Solutions said Jan. 3 it received funding from Saudi Aramco Energy Ventures to support its technological advancements in the completions and down-hole tool segment of the oilfield services industry.
Winston & Strawn partner Matt Stockstill in Dallas represented Houston-based Gryphon and CSL. Vinson & Elkins partner Wes Jones in Austin counseled Saudi Aramco Energy Ventures, a unit of Saudi Arabia’s national oil company.
Stockstill has done a lot of work for CSL. He advised it on the purchase of various businesses from Bayou Workover Services and Bayou Well Services; the acquisition out of bankruptcy of a unit of Canadian oilfield services provider Sanjel; the sale of proppant maker PyraMax Ceramics to Imerys of France; the divestiture of Mission Well Services to Calfrac Well Services; the sale of Patriot Proppants to Unimin; and the structuring, formation and day-to-day representation of various portfolio companies.
Jones has also advised Saudi Aramco before, including as lead investor in the $25 million Series D financing of construction technology company ConXtech and in the Series D financing of environmentally responsible polymers and chemicals maker Novomer.
Kent Jamison is general counsel of CSL. The Wake Forest Law graduate was previously a senior partner at Locke Lord in Dallas specializing in private equity, M&A and securities compliance matters.
Gryphon said the funds will be used to expand its rapidly evolving tool portfolio and support on-going commercialization activities.
Stallion handles purchase of Basin Wastewater in-house
Private equity firm-backed Stallion Oilfield Services said Jan. 3 it closed its acquisition of Carlsbad, N.M.-based Basin Wastewater Solutions for an undisclosed sum.
Stallion general counsel Brian Baird said he talked to a couple of the company’s usual lawyers at Vinson & Elkins about some points on the deal early on but that he did all the due diligence, closing documents and authority documents himself. Basin Wastewater Solutions was represented by Cox, Ohman & Brandstetter Chartered in Idaho.
Baird’s legal background is broad-based with an emphasis on mergers and acquisitions, corporate finance, public markets and private equity in such diverse industries as oilfield services, e-commerce and SaaS, manufacturing, commercial real estate, supply chain management and aviation.
Before joining Stallion, Baird was chief legal officer of Frank’s International, an international oilfield services company specializing in the installation of tubulars for onshore and offshore drilling applications. Along with the company’s CFO, Baird led the initial public offering of Frank’s in 2013.
Before that, the University of Texas-trained lawyer was general counsel of Pantellos, a Houston-based supply chain services and electronic marketplace owned by 20 of the largest publcly owned electric utility companies. Earlier in his career, he practiced with the law firms of Boyar & Miller and Jenkens & Gilchrist.
Stallion said the Basin acquisition will allow it to enhance its services to existing customers with a technically differentiated product line.
Stallion’s two largest shareholders are funds managed by private investment firms Centerbridge Partners and Littlejohn & Co., which helped recapitalize the company in 2016.