The Texas Lawbook

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CDT Roundup: 16 Deals, 13 Firms, 96 Lawyers, $6.5B

The stock market may be faring better in this age of COVID-19, but mergers and acquisitions have clearly suffered.

Global M&A activity fell 28% in the first quarter to $698 billion, its lowest level since 2016, and the number of deals slid 14% to 9,616, according to preliminary data from Refinitiv.

The U.S. did even worse, with activity cut in half to $252 billion. By comparison, Asia volumes dropped by 17% to $142.9 billion and Europe’s actually doubled to $232 billion because of several mega-deals announced before the outbreak began to worsen around the globe.

The biggest industry deal drops were in energy, healthcare and materials while industrials, consumer products and retail were largely flat, Refinitiv reported. Private equity firms’ percentage of the M&A market rose to 15.6% versus 10.7% last year, but they also saw a 25% decline in terms of deal count year-over-year.

Since the virus was deemed a pandemic on March 11, companies have announced $67.5 billion worth of mergers, acquisitions and investments, half as much as the same period last year, according to data compiled by Bloomberg.

Transactions already in the works are getting reworked, pushed back or canceled altogether, including in Texas. 

Witness Asbury Automotive Group last week walking away from its $1 billion purchase of Dallas-based Park Place Dealerships, which will receive a $10 million breakup fee as a result. The deal was set to close today (Locke Lord partner Kevin Peter was counseling Park Place while Jones Day counsel Martha Wach in Dallas was on the team advising Asbury). 

Some think NexPoint Hospitality Trust’s $318 million purchase of Condor Hospitality Trust Inc. also will be scuttled, as it didn’t close as expected on March 23. (NexPoint is advised by NexPoint Real Estate Advisors VI, an affiliate of Dallas-based Highland Capital Management.)

Bethesda, Md.-based Condor said in a release March 24 that it’s in talks with NexPoint concerning the close of the deal but also is reviewing its options “and reserves all rights under the merger agreement.” (Winston & Strawn advised NexPoint on the deal with a team led by Dallas partner Charlie Haag).

Generally speaking, banks are providing revolvers to stronger companies – which need liquidity to keep their operations going in the midst of falling sales – but not for deals. And nervous investors are shying away from early-stage funding for startups, which CB Insights said is down by 22% globally since the beginning of the year.

Despite all that’s going on, dealmaking among Texas lawyers continued to hum this past week, with some transactions reaching closing, others related to restructuring efforts and private equity reloading to hunt for opportunities. 

There were 16 announced transactions worth $6.5 billion, compared with 11 deals the week before valued at $11.9 billion and 15 transactions worth $6.47 billion at this time last year. 

Weekly Corporate Deal Tracker Roundup Stats

A compilation of weekly stats from The Lawbook's CDT Weekly Roundup
(Deal Values in Millions)
Week EndingDeal CountAmountFirmsLawyersM&A CountM&A Value $MCapM CountCapM Value $M
November 26, 20228$2,266.7853$765$2,190.7
November 19, 202221$2,8861521219$2,5502$336
November 12, 202213$15,093.79819$14,2004$893.7
November 5, 20222519,337.21650922$8,267.23$11,070
October 29, 202215$7,805.3911614$7,180.31$625
October 22, 202220$8,193.51325313$5,4427$2,751.5
October 15, 20229$3,046.191397$2,588.32$457.8
October 8, 202219$2,011.81211416$833.83$1,178
October 1, 202223$5,532.91615618$4,952.35$580.6
September 24, 202218$5,1941421615$4,0503$1,144
September 17, 202221$8,352.31232015$4,759.66$3,592.7
September 10, 202215$19,853.51012613$19,403.62$450
September 3, 20229$2,3129629$2,31200
August 27, 202216$30,891.71013515$30,666.41227.7
August 20, 202212$1,977815299253$1,052
August 13, 202218$8,004.71124211$2,844.77$5,160
August 6, 202224$7,948.91224017$3,5777$4,371.9
July 30, 20228$6,9419787$6,8391$102
July 23, 202211$801119210$80110
July 16, 202214$3,6501012214$3,65000
July 9, 202210$3,557.77689$3,557.710
July 2, 202218$8,609.41315215$2,754.43$5,855
June 25, 202215$6,142131469$2,0176$4,125
June 18, 202217$11,890.11422815$11,4102479.7
June 11, 202217$7,6001212310$2,3007$5,300
June 4, 202212$2,937101279$6923$2,245
May 28, 20229$3,197.611869$3,197.600
May 21, 202214$7,284.51218511$6,6093$675.5
May 14, 202211$306.698010$306.61$225
May 7, 202216$10,451.751210812$1,8274$8,624.75
April 30, 202216$2,296.51615712$895.54$1,401
April 23, 202210$2,24111588$16412$600
April 16, 202211$6,64371568$2,3593$4,284
April 9, 202217$4,4291418411$1,6906$2,739
April 2, 202213$1,75588410$1,1453$610
March 26, 202211$3,2058656$2005$3,005
March 19, 202213$2,239.17910613$2,239.1700
March 12, 202218$12,0161123915$11,9652$51.35
March 5, 202217$6,7861313713$5,1614$1,625
February 26, 202212$5,09581499$4,437.53$658
February 19, 202217$22,2291717414$21,3543$875
February 12, 202212$2,344.710738$641.74$1,703
February 5, 202211$2,50389911$2,50300
January 29, 202211$3,8721210112$3,87200
January 22, 202213$5,143.5109912$4,842.51$301
January 15, 202212$7,60591559$6,4803$1,025
January 8, 202213$8,256.21110213$8,256.200
January 1, 20229$1,273.86509$1,273.800
December 25, 202121$4,734.751117616$3,4105$1,324.75
December 18, 202126$7,325.21519318$3,640.28$3,685.2
December 11, 202116$5,0171010913$1,4173$3,600
December 4, 202114$2,3108868$2,3106$1,882.05
November 27, 20219$3.460.1101016$1,7583$1,702.6
November 20, 202120$22,7921515712$18,864.58$3,928
November 13, 202121$26,7291217813$11,8228$14,907
November 6, 202112$8,3031315710$6,6823$1,621
October 30, 202121$10,3681521815$9,24.46$1,103.
October 23, 202121$18.783.11522211$12,31410$6,468.6
October 16, 202115$3,8681111815$2,2932$1,575
October 9, 202120$8,6101617516$7,7954$815
October 2, 202114$6,2501113710$5,2004$1,050
September 25, 202111$11,4609937$10,2004$1,250
September 18, 202111$16,6038998$15,0843$1,519
September 11, 202117$10,6531110313$8,5034$2,150
September 4, 202113$7,222108911$6,7152$507
August 28, 202112$76396311$6631$100
August 21, 202112$29,65977911$29,5791$80
August 14, 202122$17,8451119912$12,80510$5,04
August 7, 202117$13,6701213915$11,7662$1,904
July 31, 202121$8,1601113410$3,57410$4,586
July 24,202121$6,3671113915$3,7126$2,655
July 17, 202114$4,0091112412$2,0152$1,994
July 10, 202116$3,9971314311$1,5974$2,4
July 3, 202124$7,492139416$3,7698$3,722
June 26, 202110$4,9957858$3,8472$1,148
June 19, 202128$16,83082289$1,86119$14,968
June 12, 202126$27,2381520919$25,6027$1,636
June 5, 202115$15,5391310013$14,7092$600
May 29, 202135$20,2791114528$18,647$1,639
May 22, 202124$53,2081417417$51,0477$2,161
May 15, 202118$10,6201322011$5,8707$4,809
May 8, 202117$10,4001115615$8,3862$2,500
May 1, 202121$7,2001611512$3,8089$3,392
April 24, 20218$20,2009318$20,20000
April 17, 202114$6,270810211$4,01803$2,260
April 10, 202115$8,9401312914$7,9901$950
April 3, 202118$19,5131015112$16,9236$2,590
March 27, 202127$13,9421524414$4,30013$9,633.5
March 20, 202111$2,04641023$2708$1,776
March 13, 202115$3,27091096$5389$2,732
March 6, 202124$13,6171019613$10,39511$3,222
February 27, 202119$8,1051213915$4,9704$3,135
February 20, 20219$8,82091538$8,5201$300
February 13, 202112$4,852.678172,7665$2,086.6
February 6, 202118$9,7521315314$5,2224$4,530
January 30, 202118$9,449918215$8753.83$695.3
January 23, 202114$8,15081186$4,0008$4,150
January 16, 202117$6,7831313811$2,4006$4,382.9
January 9, 202122$6,8291413518$3,139.34$3,690
January 2, 20217$1,4667607$1,46600
December 26, 202018$15,9001216316$5,3001$600
December 19, 202018$9,7691411014$8,4264$1,343
December 12, 202010$7,20091009$3,3251$3,830
December 5, 202015$4,26191229$2,7806$1,481
November 28, 202019$7,7581011013$4,0036$3,755
November 14, 202014$864.11415712$289.12$575
November 7, 202013$6,33291299$2,483.54$3,849
October 31, 202010$3,995.881036$3,231.14$754.7
October 24, 20206$18,1006585$17,7091$350
October 17, 20208$351.95558$351.900
October 10, 20207$5,2293504$7353$4,494
October 3, 202014$21,42891739$17,5355$3,893
September 26, 202010$12,7708935$10,3005$2,470
September 19, 202014$8,36591016$1,0208$7,345
September 12, 20206$4,4068593$1,2703$3,136
September 5, 202011$5,19181179$4,0612$1,130
August 29, 202011$2,5319945$1,1306$1,401
August 22, 202018$6,574121407$1,93011$4,644
August 15, 202013$4,99110977$1,2166$3,775
August 8, 202012$32,092111129$30,4573$1,635
August 1, 20207$5,2878765$3,6872$1,600
July 25, 20209$18,7516677$18,4032$348
July 18, 20206$1,982.55504$1,407.52$575
July 11, 202011$565.1127510$65.11$500
July 4, 202010$8,8898989$8,7881$100.3
June 27, 20208$6,87410505$4,972.53$2,081.5
June 20, 202012$4,44491157$2,8295$1,615
June 13, 20206$3,5824372$3504$3,232
June 6, 202011$3,213.78657$4704$2,743.7
May 30, 20208$7,3357486$4,6392$2,697
May 23, 20204$432.44343$432.410
May 16, 20206$3106345$31010
May 9, 202018$5,6301612414$3,1804$2,450
May 2, 20201510,40010908$1,9007$,8,500
April 25, 20208$3,4009365$1,0003$2,450
April 18, 202019$9,50014928$185.711$9,360
April 11, 202012$6,0009405$1907$5,800
April 4, 202014$8,200116810$2,2004$6,000
March 28, 202016$6,500139610$3,7006$2,800
March 21, 202011$11,9107337$2,2504$9,960
March 14, 20207809.86346684.81125
March 7, 202016$2,500157013$6693$1,400
February 29, 202013$15,2601312811$11,7602$3,500
February 22, 202012$3,700109210$2,5602$1,130
February 15, 202016$1,250108412$354$1,222
February 8, 202018$6,0801412314$2,5954$3,485
February 1, 202021$20,9001210114$17,8607$3,060
January 25, 202013$7,430136212$6,4301$1,000
January 18, 202023$9,5801512019$6,5804$3,000
January 11, 202021$14,2001819916$1,0205$13,200
January 4, 202022$6,4001111916$3,2046$3,245
December 28, 201922$7,1501917518$6,8004$327.4
December 14, 201924$36,3002316719$9,5005$26,800
December 7, 201911$10,40011557$1,0824$9,370
November 30. 201914$2,4501212612$1,7602$692.5
November 23, 201916$1,995104111$6155$1,380
November 16, 201915$3,8201313511$2,5004$1,271
November 9, 201925$12,9001718223$12,2002$575
November 2, 201910$2,470126192,4503$22
October 26, 201912$5,560147011$3,8601$1,700
October 19, 20198$6,60081388$6,60000
October 12, 201919$4,300145516$3,8003$500
October 5, 201918$14,5001916615$11,1003$3,400
September 28, 201919$8,1001813218$7,5601$550
September 21, 201914$6,300166611$2,1603$4,170
September 14, 201915$23,800125611$21,2504$2,570
September 7, 201917$3,500159814$1,9003$1,600
August 31, 20195$8,7006505$8,70000
August 24, 201916$10,000148215$4,2501$5,750
August 16, 201910$1,6805527$6503$950
August 9, 201917$17,700156814$3,9003$13,800
August 2, 201913$5,7601210813$5,760NANA
July 27, 201911$7,30013768$6,5703$730
July 20, 201913$11,8001312511$5,3002$6,500
July 13, 201910$7757468$542.52$233
July 6, 20197$2,5009857$2,50000
June 29, 201923$8,2901515417$2,3006$5,970
June 22, 201917$10,7001013914$7,7003$3,000
June 15, 201911$13,5001416011$13,500NANA
June 8, 201913$2,870175511$1,5702$1,300
June 1, 201910$4,46011608$4,1402$315
May 25, 201917$4,360147914$3,7003$612
May 18, 201922$9,0001715016$3,4006$5,600
May 11, 201918$19,8001717715$18,3003$1,500
May 4, 201910$7,0756328$6,9002$175
April 27, 201915$3,2001411714$3,1601$40
April 20, 201913$13,50010909$12,2004$1,300
April 13, 201916$38,900149114$37,8002$1,100
April 6, 201912$6,870119410$6,7302$50
March 30, 201915$6,470128410$7,91.55$5,677
March 23, 201918$6,450149114$5,0424$1,408
March 16, 201914$10,1801211511$8,8003$1,300
March 9, 20199$1,8006498$1,3001$500
March 2, 201920$3,0331610714$1,8176$1,262
February 23, 201912$2,0408699$614.63$1,430
February 16, 201916$9,970187716$9,97000
February 9, 201914$6,4001011014$6,40000
February 2, 201918$6,740159916$5,7202$950
January 26, 201913$2,770116711$918.952$1,850
January 19, 201915$3,819167612$2,5943$1,225
January 12, 201918$7,283149215$1,6833$5,600
January 5, 201910$529125010$52900
December 22, 201817$2,570138714$9413$1,629
December 15, 201810$2,8608268$2642$2,600
December 8, 201815$1,819166512$5523$1,267
December 1, 201812$7,50010909$1,2003$6,200
November 28, 201815$4,5001110714$4,0001$500
November 19, 201818$6,137139813$2,1425$3,995
November 14, 201818$9,2001315215$8,5003$694
November 6, 201816$17,3001618314$16,3612$950
October 29, 201814$14,4001812717$13,8001$600
October 24, 201813$6,1401312611$5,1222$1,018
October 17, 201818$18,3901512514$12,2924$6,098
October 10, 201829$3,1491810420$1,6479$819
October 2, 201818$9,300116714$7,3004$2,000
September 25, 201813$7,000117510$6,0003$995
September 18, 20189$3,5707449$3,57000
September 11, 201813$5,9001013213$5,90000
September 7, 201814$5,000158611$4,0003$1,000
August 29, 201815$20,700147913$4,7002$16,000
August 20, 201810$12,40011538$11,3803$1,057
August 14, 201812$19,900121329$18,8893$1,011
August 7, 201816$68,6001110613$67,2593$1,340
July 31, 201815$15,100159511$13,0604$2,060
July 23, 201813$2,130156010$1,8043$1,100
July 17, 201814$5,37017989$4,3105$1,100
July 9, 201816$11,200157410$11,0806$862
July 3, 201813$7,00078112$6,3301$750
June 25, 201815$8,80013979$4,9706$3,930
June 18, 201813$14,20014807$2216$14,290
June 11, 201812$6,3008968$5,9104$803
June 6, 201813$14,50010888$14,1545$579
May 31, 201811$4,89010638$3,2403$1,790
May 22, 201815$20,40011639$19,8086$885
May 15, 201815$4,7001510610$3,9005$643
May 9, 201811$1,40013889$1,3002$560
May 1, 20188$14,2507887$13,4001$450
April 24, 201812$5,30066111$4,4701$800
April 17, 20189$1,80010447$2,3302$1,434
April 11, 201811$2,5008326$1,6905$809
April 3, 201815$13,400111219$12,0206$1,090
March 28, 201810$4,00010927$3,8703$215
March 19, 201817$5,800135110$5907$5,165
March 12, 201815$3,130114311$2,3604$788
March 6, 201819$5,4001311610$1,5309$4,860
February 27, 201820$6,600136914$5,5306$1,030
February 19, 201815$5,5001411110$3,9906$1,980
February 12, 201823$10,9001715712$7,11011$3,840
February 5, 201816$8,600131007$1,3309$7,800
January 30, 201811$12,60011685$7,3006$4,982
January 24, 201819$9,400151295$2,01014$7,337
January 18, 201810$6,2808492$2,1008$4,188
January 9, 201812$16,50012929$15,8903$475
January 3, 201810$2,5009478$2,3502$150
December 27, 201715$9,000151139$7,5686$1,784
December 18, 201715$13,800161649$13,0107$1,118
December 11, 201714$9,7001012612$2,9404$8,500
December 4, 20176$1,8006315$1,5101$300
November 28, 20177$3,8508764$3,2603$285
November 16, 201710$2,70010486$1,8404$856
November 8, 201715$2,380179110$1,8605$516
November 1, 201712$4,70017949$3,4004$1,300
October 23, 201715$10,500106710$9,7804$1,530
October 18, 20176$2,000373$2253$1,820
October 10, 201712$6,5701009$3,8803$3,360
October 2, 20178$3,10011193$1,6305$1,750
September 25, 20178$4,8808795$2,6605$2,070
September 18, 20179$4,7703$3006$4,470
September 12, 201711$4,4308$2,0303$2,400
September 1, 20174$1,3103$3171$1,000
August 23, 201711$13,64098$11,8403$1,800

Thirteen law firms and 96 Texas lawyers were involved in the activity, which included 10 M&A/private equity/venture capital deals valued at $3.7 billion and 6 capital markets transactions worth $2.8 billion.

M&A/PRIVATE EQUITY/VENTURE CAPITAL

Jasper Ridge Partners raises $2.4 billion

Jasper Ridge Partners in Fort Worth has raised $2.4 billion for its Jasper Ridge Diversified fund, according to a March 24 filing with the Securities and Exchange Commission.

Jasper executives didn’t respond to requests for their legal counsel. Rajesh Swaminathan is its general counsel, Patrick McGlinchey is its associate general counsel, John Walker is its assistant general counsel, John Fant is its senior strategic counsel and Howie Pearson is special counsel.

Jasper is an asset management firm providing discretionary investment services and customized solutions to prominent families, foundations and global institutions.

The firm manages more than $21.2 billion in assets with expertise across asset classes, including public equity, fixed income, hedge funds, private equity, venture capital, real estate and natural resources.

Tailwater closes $1.1B midstream energy fund

Dallas private equity firm Tailwater Capital said March 26 it closed its fourth fund with $1.1 billion in capital commitments, its largest fund to date.

Thompson & Knight counseled Tailwater, including Wes Williams, Dean Hinderliter, Anna Marie Dempsey, Jason Loden, Mitch Gibbons, Nathan Stone, Marc Lombardi, Dasha Hodge and Holt Foster.

Tailwater said the capital commitments include a co-investment for one of the fund’s platform companies, which it didn’t name. It’s already committed capital to several new platform companies.

The firm said the fund will continue its strategy of partnering with proven management teams to identify attractive opportunities in midstream infrastructure. 

Tailwater said it has more than $1.3 billion in “dry powder” and management teams operating in all of the core onshore basins in the U.S., giving it the opportunity to buy assets given the capital access challenges in the energy industry.

The firm is led by founding partners Jason Downie and Edward Herring, who have worked together for more than two decades. Since its inception in 2013, Tailwater has raised more than $3.7 billion across its funds and co-investments and executed more than 100 transactions representing $20 billion of transaction value.

Downie said management believes it will see some of the most compelling buying opportunities it’s come across in many years.

“Having invested through multiple cycles, we are confident private equity will play a critical role in solving the prevailing capital constraints of the energy industry,” he said.

The firm’s third fund closed in July 2018 with commitments of $1 billion, including a co-investment for a platform company in the fund and committed capital to six platform companies.

McGuireWoods, Baker Botts aid on Dominion’s $175M pipeline, LNG purchase from Southern

Dominion Energy has bought a 5% stake in the Atlantic Coast Pipeline and all of the Pivotal LNG facility from Southern Co. for $175 million.

Dominion completed the Pivotal LNG acquisition on March 24.

The deal gives Dominion 53% of the pipeline, up from 48%, with Duke Energy Corp. owning the other 47%. Southern will remain an anchor customer of the pipeline via its unit Virginia Natural Gas.

The Pivotal deal gives Dominion a liquefaction facility in Trussville, Ala., and a 50% ownership of the Jax LNG ship bunkering operation in Jacksonville, Fla. (NorthStar Midstream owns the other half of Jax).

Baker Botts counseled Southern Co., including Houston senior counsel Bill Lamb and partner Jon Bobinger. Kathryn McCoy was the main in-house counsel for Southern Company Gas. Willkie partner Archie Fallon in Houston represented Southern as LNG project counsel for Jax. 

McGuire Woods partner Jay Hughes in Houston and associate Sam Fubara in Dallas were part of the team that represented Dominion. 

Jax is the first small-scale liquefied natural gas facility in the U.S. with the capability to load LNG into marine vessels and trucks. Including Trussville, the two facilities have the capacity to produce 180,000 gallons a day and store 7 million gallons, with Jax having the ability to expand production capacity an additional 480,000 gallons per day.

Roger Williams, Dominion’s VP of gas development services, said in a statement that the acquisition of Pivotal LNG will play an important role in its broader strategy to help decarbonize the marine shipping industry.

“The acquisition of Pivotal and our existing Cove Point LNG facility in Maryland positions us well to lead the transformation of the marine industry and to serve other growing LNG markets along the East Coast,” he continued. 

HuntonAK counsels Key EM Energy on $70M EdgeMarc purchase

Hunton Andrews Kurth said March 26 it counseled KeyBank unit Key EM Energy on its purchase of natural gas wells in Pennsylvania from bankrupt Goldman Sachs-backed EdgeMarc Energy Holdings for $70 million.

The deal was announced Jan. 24 and closed Feb. 24.

Houston partner Tad Davidson led the deal team, which included Houston partners Tammy Brennig, Joe Buoni, Courtney Butler, Jeff Butler, Phil Haines, Allison Mantor and Harve Truskett; Austin partners Anthony Eppert and Lisa Shelton; and Dallas partner Greg Hesse.

The Texas associates were Andrew Blasio, Emily Cabrera, Edward Clarkson, Ian Goldberg, Jared Grodin, Philip Guffy, Ashley Harper, Mike Hoffman, Alex Miron, Rachel Morico, Adam Ragan and Joseph Rovira.

Davis, Polk & Wardwell represented EdgeMarc. Landis Rath & Cobb was debtors counsel while Evercore Partners was its investment banker and Opportune and Dacarba were its financial advisors.

Led by CEO Callum Streeter, EdgeMarc filed for Chapter 11 in a Delaware bankruptcy court in May of last year after the 2018 explosion of Energy Transfer’s Revolution pipeline curtailed its production, preventing it from satisfying its long-haul firm transportation contracts. The company decided a sale was the best path forward for stakeholders.

KeyBank provided a $108 million debtor-in-possession bankruptcy loan to EdgeMarc, including $30 million in new money financing and $78 million of “roll up” loans to refinance all outstanding debt it owed to KeyBank. KeyBank ended up winning the bankruptcy auction to buy the operations in Butler County, Pa., where the debtor controls around 32,000 acres. 

The bank will apply $60 million of the debt EdgeMarc owes it to the sale price and pay about $9.7 million in cash, according to a sale notice filed Jan. 24 with the bankruptcy court.

EdgeMarc sold other assets to Diversified Gas & Oil this past summer for $50 million, with Baker Botts partner Jim Prince in Dallas counseling Diversified. 

V&E advises bankrupt Carbo Ceramics on sale to Wilks, Equity Financial

Vinson & Elkins said March 30 it advised Carbo Ceramics Inc. on its sale to Wilks Brothers and Equity Financial through a debt-for-equity exchange as part of a reorganization plan in a Chapter 11 bankruptcy case.

The team was led by partners Paul Heath and Mike Telle along with a restructuring partner in the firm’s New York office (David Meyer). Other Texas lawyers on the team were partners Matt Moran, Guy Gribov, Wendy Salinas, David Peck, David D’Alessandro, Sean Becker and Tom Wilson.

Others were restructuring senior associate Garrick Smith and associates Matt Struble and Mike Garza; litigation senior associate Jeremy Reichman and associate Holly Meyers; corporate associates Todd Hartis and John Daywalt; labor/employment counsel Christie Alcalá; executive compensation/benefits counsel Regina Ibarra; and senior associate Zach Rider on finance.

Also advising the company were Perella Weinberg Partners, together with its corporate advisory affiliates, including Tudor Pickering Holt & Co., and FTI Consulting Inc.

Carbo also used Matthew Okin at Okin Adams in Houston on the bankruptcy. Norton Rose Fulbright partner Greg Wilkes in Dallas represented Wilks Brothers and Equify Financial.

Carbo announced the agreement March 29, saying it initiated a voluntary Chapter 11 process in the U.S. Bankruptcy Court for the Southern District of Texas in Houston to facilitate and effectuate the transaction.

Chairman and CEO Gary Kolstad said like many companies with a significant concentration in the oil and gas industry, Carbo has felt the impact of the challenging business environment and worked diligently to strengthen its overall financial foundation.

“While Carbo has undoubtedly made progress in our transformation strategy, we ultimately expect these headwinds to persist,” he said. “We are pleased to reach an agreement with the Wilks Brothers. We are confident that, under their ownership and investment, we will be better positioned to maximize value, realize the potential of Carbo and serve our customers as we move forward.”

The Wilks Brothers committed to providing $15 million in debtor-in-possession financing and consented to the use of its cash collateral to bolster Carbo’s financial position and finance its operations through the process. 

This financing, combined with the company’s usual operating cash flows, will allow Carbo to continue to operate in the ordinary course through the restructuring process, the company said.

Wilks Brothers’ Matt Wilks said he’s long believed in the underlying strength of Carbo’s business, given its multi-year relationship with the company, and that the transaction will allow Wilks Brothers to invest in Carbo’s future as it pursues opportunities to unlock value and support growth.

Consummation of the plan and the restructuring have to clear the bankruptcy court.

ION Geophysical sells 49% stake in INOVA Geophysical Equipment for $12M

ION Geophysical Corp. said March 20 it agreed to sell its 49% stake in INOVA Geophysical Equipment Ltd. for $12 million. It didn’t name the buyer.

ION Geophysical deputy general counsel Michael Collins told The Texas Lawbook that the company handled the deal in-house. Matthew Powers is the company’s general counsel.

BGP Inc. owns the other 51% of INOVA, a land seismic equipment joint venture. BGP claims to be the world’s largest land seismic service provider.

The parties expect to close the deal in the second half of the year if it clears regulators.

INOVA provides land geophysical technology, including acquisition systems, source products and digital sensors. In 2014, ION wrote down its investment in INOVA to zero.  

“This divestment is aligned with ION’s strategy to focus on higher potential return offerings offshore that value our leading technology and experience while monetizing non-core assets,” ION president and CEO Chris Usher said in a statement. 

ION plans to use the proceeds to support the company’s entry into the 3D new acquisition market and the development of its Marlin SmartPort business while further bolstering its liquidity.

BoyarMiller represents Quest Design on sale to Universal Forest Products

The GulfStar Group said March 23 that it provided financial advice to Quest Design & Fabrication and Quest Architectural Millwork on their sale to Universal Forest Products Inc., which does business as UFP Industries. Terms weren’t disclosed.

The investment bank said Bill Boyar, Adebola Akisanya, Travis Johnson and Corinne Sullins of BoyarMiller provided legal counsel to Quest. 

GulfStar managing director Colt Luedde worked on the deal along with VP Charlie Craig, associates Jon Sanfelippo and Sarah Wilson and analyst MG Jadick.

Based near Houston, Quest specializes in designing, fabricating and installing millwork and case goods for builders’ sales centers, design studios, hospitality, corporate offices and healthcare. The company generated $22 million in sales last year. CEO and president Jon Deutser will continue to run it.

Deutser said the two companies share multiple customers and the buyer’s national footprint will help Quest grow quickly and better serve customers. 

UFP Industries is a holding company whose units supply wood, wood composite and other products to the retail, construction and industrial markets. Founded in 1955, the company is headquartered in Grand Rapids, Mich., with affiliates throughout North America, Europe, Asia and Australia.

Katten advises Three Oaks Hospice on Godly Hospice acquisition

Katten said March 23 it advised Dallas-based Three Oaks Hospice Inc. on its purchase of Godly Hospice and Palliative Care for undisclosed terms.

Dallas partner Gregory Hidalgo led the deal team, which included associates Ethan Post, Jonathan Stoddard and partner William Rivers. The deal closed Jan. 31.

Founded by healthcare and hospice executives, Three Oaks Hospice launched last fall with three acquisitions and $21 million in backing from Granite Growth Health Partners, Health Velocity Capital and Petra Capital Partners. The company is led by chairman David Gasmire and CEO Andrea Bohannon.

Sidley represents Twin Eagle on sale of energy management business

Sidley Austin said March 23 it represented Blackstone Group-backed Twin Eagle Resource Management on the sale of its energy management business and transfer of related personnel. It didn’t name the buyer.

The deal team was led by counsel Atman Shukla in Houston and included partners Cliff Vrielink and Zack Pullin and associate Kayleigh McNelis, all of Houston. It had help from a partner in Washington, D.C. (Jim Mendenhall).

The parties signed the transaction on March 16. One report said Germany’s Uniper was in discussions to buy the business.

Willkie advises Percussion management on Carnelian Energy investment

Willkie said March 25 it represented the management team, including John Campbell III and Brian Zwart, on the formation of Houston-based Percussion Petroleum II and equity commitment from Carnelian Energy Capital.

Partner Michael De Voe Piazza in Houston led the deal team. Carnelian partner Tomas Ackerman told The Lawbook that the private equity firm handled the investment internally (assistant general counsel Matt Savage in Houston).

Percussion II announced the investment March 24, saying it would pursue an acquisition and development strategy in select onshore basins in North America.

Percussion I put together a position in the northwest shelf of the Permian Basin, including interests in around 380 gross producing wells and 22,000 net acres in the core of the Yeso formation in Eddy & Lea Counties, New Mexico, and associated water and midstream assets. Spur Energy Partners bought the assets in mid-2019. 

“This is an exciting time to be well capitalized as we pursue new opportunities,” Campbell and Zwart said in the release.

Ackerman said the firm is looking forward to “getting to work during this opportunity-rich time in the energy markets.”

Carnelian has attracted $1.8 billion in equity commitments. It focuses on lower-to-middle market equity investments in North America, primarily in the upstream, or exploration and production, part of the sector.

CAPITAL MARKETS/FINANCINGS

Bracewell aids Phillips 66 on $1B 364-day delayed draw term loan

Bracewell said March 27 that it represented Phillips 66 as borrower on a $1 billion 364-day delayed draw term loan agreement with Mizuho Bank Ltd., which served as administrative agent and lead arranger. 

The team included Houston partner Heather L. Brown along with a firm partner in New York (Robin J. Miles) and Houston associate Emily A. Banse.

Hunton Andrews Kurth partners Tom Perich and Jeff Butler in Houston counseled Mitzuho.

Phillips 66 has the option to increase the facility’s amount by up to $1 billion, subject to the reduction of Mizuho’s initial funded amount and additional lenders providing additional commitments and loans.

Phillips 66 has businesses in oil and gas refining, midstream, chemicals and marketing.

Latham advises Waste Connections on $500M senior notes offering

Latham & Watkins said March 24 that it advised Waste Connections on a $500 million senior notes offering.

Houston partner John Greer led the deal team along with associates Ryan Lynch, Erin Lee, Katie Walker and Trevor Bossi. Attorneys from the firm’s New York and Los Angeles offices also helped (including partners Bora Bozkurt and Jocelynn Noll).

Simpson Thacher represented the underwriters with attorneys out of New York (including Roxane Reardon). BofA Securities, J.P. Morgan, MUFG and Wells Fargo Securities are joint book-running managers and underwriters.

The offering involves 3.05% senior notes due 2050 at a price to the public of 98.525% of their face value. Waste Connections expects to use the $487 million in net proceeds to repay part of its borrowings outstanding under its revolver and its term loan and for general corporate purposes.

HuntonAK works on four capital markets transactions worth $1.275B

Hunton Andrews Kurth said March 26 that its Texas lawyers worked on four capital markets transactions, which together are worth at least $1.275 billion.

The firm was underwriters’ counsel for One Gas Inc.’s $250 million public offering of common stock on Feb. 26. The team was led out of New York but included Houston associate Erin Jennings. GableGotwals counseled the other party. The banks included Morgan Stanley, Mizuho Securities USA Inc. and Banc of America Securities.

HuntonAK also was underwriters’ counsel for NexPoint Residential Trust Inc.’s $225 million public offering of common stock on March 4. The team was led out of Richmond, Va., but included Houston associates Hannah Bradley, Oliver Fankhauser, Marshall Heins and Samantha Siegler. Winston & Strawn counseled the other party. The banks were Raymond James & Associates Inc., SunTrust Robinson Humphrey Inc., KeyBanc Capital Markets Inc. and Jefferies.

The firm was underwriters’ counsel for an unquantified sale of asset-backed securities for Figure Line of Credit Trust 2020-1 on March 5. The transaction was led out of New York but included Dallas associate Rachael Craven and partner Abby Lyle, with Dentons counseling the other party. Jefferies was the bank. 

Finally, HuntonAK was initial purchasers’ counsel for Oncor Electric Delivery Co.’s $800 million debt offering of seniors notes on March 20. That team was led out of New York but included Houston associate Tim Strother. Baker McKenzie represented the other party. The banks were US Bancorp Piper Jaffray, Mizuho Securities USA Inc., SMBC Nikko Securities America Inc. and TD Securities.

UPDATE/OTHER

Bankruptcies in the oil and gas industry are starting to roll in after the oil drop caused by the Saudi-Russia price war and the demand-sapping qualities of the coronavirus. 

Houston oil and gas investment fund Sheridan Holding Co. I filed for Chapter 11 last week in U.S. Bankruptcy Court in Houston before Judge David R. Jones. The move followed Sheridan II’s emergence from bankruptcy in January with a new name (Sunrise Oil & Gas). The company filed on March 23 and had its plan of confirmation completed the next day.

Sheridan tapped Kirkland & Ellis as its lead law firm with attorneys in New York. The debtor also used Jackson Walker partner Matthew Cavenaugh out of Houston. Vinson & Elkins counsel Bradley Foxman in Dallas represented creditor Bank of America.

Houston-based Echo Energy Partners I also filed for bankruptcy in Houston on March 24 with the aim of selling its portfolio of oil and gas wells in Oklahoma. The case also is before Judge Jones.

Bracewell is Echo’s legal counsel  – partners Trey Wood and Jason G. Cohen in Houston – and Opportune is its financial adviser. Winstead is counseling creditor Texas Capital Bank (shareholder Joseph Wielebinski and associate Annmarie Chiarello in Dallas) and Bonds Ellis Eppich Schafer Jones is representing creditor Marathon Oil (partner Clay Taylor in Fort Worth).

***

Occidental Petroleum reached a settlement with billionaire activist investor Carl Icahn in which it will bring three new Icahn-designated directors to the company’s board: Andrew Langham, Nicholas Graziano and Margarita Paláu-Hernández. 

Former Oxy chief Stephen Chazen will be chairman of the board. Existing directors Spencer Abraham, Eugene Batchelder, Margaret M. Foran and Elisse B. Walter will retire. 

Icahn, who was critical of Occidental’s purchase of Anadarko Petroleum, said he believes Oxy is a good company with good assets and will focus on working with Chazen to enhance value for all stockholders.

Leading the agreement in-house were Oxy general counsel Marcia Backus and deputy general counsel Nicole Clark. Cravath, Swaine & Moore was the company’s outside legal advisor (partners George Schoen, Keith Hallam and Allison Wein in New York). Icahn Enterprises’ general counsel is Jesse Lynn.

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