Despite the negative numbers coming out about mergers and acquisitions activity, there’s one sector that’s holding surprisingly steady: U.S. oil and gas.
According to an Oct. 2 report by Austin-based Enverus (the new name for Drillinginfo), U.S. oil and gas M&A surpassed $17 billion in the third quarter, maintaining the momentum established in the second quarter.
The data provider said the quarterly total approaches the 2016-18 quarterly average of $19 billion and puts year-to-date M&A at more than $85 billion.
“Most public [exploration and production, or E&P] companies are highly limited in access to external capital right now,” Enverus senior M&A analyst Andrew Dittmar said in the release. “Shale companies are turning to deals as another option in the toolbox to bridge the gap to free cash flow and hopefully shift market sentiment back in their favor.”
In contrast with prior years, when Permian asset deals dominated, the firm is seeing broad geographic diversity in the market and a variety of deal types, including joint ventures and royalties. It noted Hilcorp’s $5.6 billion pick-up of BP’s Alaska business, which was the largest deal of the quarter, followed by Callon Petroleum’s $3.2 billion purchase of Carrizo Oil & Gas and PDC Energy’s $1.7 acquisition of fellow DJ Basin producer SRC Energy.
While the Callon-Carrizo merger is facing opposition due to its 25% premium and the addition of Carrizo’s Eagle Ford assets to Callon’s Permian portfolio, there is a broad consensus that corporate consolidation is positive for the industry, Dittmar said.
“While the benefits are there, getting the right deal in place is challenging,” he said. “Companies that match up on asset fit are needed as well as a low premium to avoid a buyer selloff. Conversely, targets have to be convinced on the long-term upside since an immediate payoff isn’t evident.”
With very little buying from public companies, private capital has partially stepped up, the firm said, most significantly from KKR-sponsored Spur Energy, which has deployed more than $1 billion, including a $925 million acquisition from Concho targeting the New Mexico Shelf.
“Private equity looks to be largely sticking to their script from prior quarters and cautiously deploying capital on deals secured with significant cash flow,” Enverus market research director John Spears said, noting Warburg Pincus-backed Citizen Energy and its $1 billion take-private of Roan Resources. “We could see other small cap E&Ps with high debt and low share prices take similar buyout offers.”
Low company and asset prices in the U.S. also are starting to draw interest from abroad, Enverus said, noting the Osaka Gas purchase of East Texas gas producer Sabine Oil & Gas for a reported $610 million and Colombia-based Ecopetrol signing a $1.5 billion joint development deal with Occidental targeting undeveloped acreage in the Midland Basin.
“While the Osaka deal was more narrowly tailored to source gas for LNG, the Ecopetrol JV shows that international companies view U.S. shale assets as competitive on a global basis,” the firm said.
The firm also noted the handful of Chapter 11 filings during the third quarter, including Halcón Resources, Sanchez Energy and Alta Mesa, adding that there could be a shift away from traditional recapitalizations to more liquidations via bankruptcy sales processes as some lose patience and see companies going through multiple reorganizations.
Going forward, Enverus said public companies are likely to remain highly focused on keeping capital expenditures in check while maintaining moderate production growth to deliver on promised free cash flow and capital returns from dividends or buybacks, which may translate into little appetite for acquisitions among some independent publicly traded E&P companies.
Meanwhile, in overall dealmaking by Texas lawyers, it was another big week, with the Corporate Deal Tracker finding 18 transactions valued at $14.5 billion. That compares with 19 deals the previous week worth $8.1 billion and 18 transactions at this time last year valued at $9.3 billion.
Weekly Corporate Deal Tracker Roundup Stats
A compilation of weekly stats from The Lawbook's CDT Weekly Roundup
(Deal Values in Millions)
(Deal Values in Millions)
|Week Ending||Deal Count||Amount||Firms||Lawyers||M&A Count||M&A Value $M||CapM Count||CapM Value $M|
|June 25, 2022||15||$6,142||13||146||9||$2,017||6||$4,125|
|June 18, 2022||17||$11,890.1||14||228||15||$11,410||2||479.7|
|June 11, 2022||17||$7,600||12||123||10||$2,300||7||$5,300|
|June 4, 2022||12||$2,937||10||127||9||$692||3||$2,245|
|May 28, 2022||9||$3,197.6||11||86||9||$3,197.6||0||0|
|May 21, 2022||14||$7,284.5||12||185||11||$6,609||3||$675.5|
|May 14, 2022||11||$306.6||9||80||10||$306.6||1||$225|
|May 7, 2022||16||$10,451.75||12||108||12||$1,827||4||$8,624.75|
|April 30, 2022||16||$2,296.5||16||157||12||$895.5||4||$1,401|
|April 23, 2022||10||$2,241||11||58||8||$1641||2||$600|
|April 16, 2022||11||$6,643||7||156||8||$2,359||3||$4,284|
|April 9, 2022||17||$4,429||14||184||11||$1,690||6||$2,739|
|April 2, 2022||13||$1,755||8||84||10||$1,145||3||$610|
|March 26, 2022||11||$3,205||8||65||6||$200||5||$3,005|
|March 19, 2022||13||$2,239.17||9||106||13||$2,239.17||0||0|
|March 12, 2022||18||$12,016||11||239||15||$11,965||2||$51.35|
|March 5, 2022||17||$6,786||13||137||13||$5,161||4||$1,625|
|February 26, 2022||12||$5,095||8||149||9||$4,437.5||3||$658|
|February 19, 2022||17||$22,229||17||174||14||$21,354||3||$875|
|February 12, 2022||12||$2,344.7||10||73||8||$641.7||4||$1,703|
|February 5, 2022||11||$2,503||8||99||11||$2,503||0||0|
|January 29, 2022||11||$3,872||12||101||12||$3,872||0||0|
|January 22, 2022||13||$5,143.5||10||99||12||$4,842.5||1||$301|
|January 15, 2022||12||$7,605||9||155||9||$6,480||3||$1,025|
|January 8, 2022||13||$8,256.2||11||102||13||$8,256.2||0||0|
|January 1, 2022||9||$1,273.8||6||50||9||$1,273.8||0||0|
|December 25, 2021||21||$4,734.75||11||176||16||$3,410||5||$1,324.75|
|December 18, 2021||26||$7,325.2||15||193||18||$3,640.2||8||$3,685.2|
|December 11, 2021||16||$5,017||10||109||13||$1,417||3||$3,600|
|December 4, 2021||14||$2,310||8||86||8||$2,310||6||$1,882.05|
|November 27, 2021||9||$3.460.1||10||101||6||$1,758||3||$1,702.6|
|November 20, 2021||20||$22,792||15||157||12||$18,864.5||8||$3,928|
|November 13, 2021||21||$26,729||12||178||13||$11,822||8||$14,907|
|November 6, 2021||12||$8,303||13||157||10||$6,682||3||$1,621|
|October 30, 2021||21||$10,368||15||218||15||$9,24.4||6||$1,103.|
|October 23, 2021||21||$18.783.1||15||222||11||$12,314||10||$6,468.6|
|October 16, 2021||15||$3,868||11||118||15||$2,293||2||$1,575|
|October 9, 2021||20||$8,610||16||175||16||$7,795||4||$815|
|October 2, 2021||14||$6,250||11||137||10||$5,200||4||$1,050|
|September 25, 2021||11||$11,460||9||93||7||$10,200||4||$1,250|
|September 18, 2021||11||$16,603||8||99||8||$15,084||3||$1,519|
|September 11, 2021||17||$10,653||11||103||13||$8,503||4||$2,150|
|September 4, 2021||13||$7,222||10||89||11||$6,715||2||$507|
|August 28, 2021||12||$763||9||63||11||$663||1||$100|
|August 21, 2021||12||$29,659||7||79||11||$29,579||1||$80|
|August 14, 2021||22||$17,845||11||199||12||$12,805||10||$5,04|
|August 7, 2021||17||$13,670||12||139||15||$11,766||2||$1,904|
|July 31, 2021||21||$8,160||11||134||10||$3,574||10||$4,586|
|July 17, 2021||14||$4,009||11||124||12||$2,015||2||$1,994|
|July 10, 2021||16||$3,997||13||143||11||$1,597||4||$2,4|
|July 3, 2021||24||$7,492||13||94||16||$3,769||8||$3,722|
|June 26, 2021||10||$4,995||7||85||8||$3,847||2||$1,148|
|June 19, 2021||28||$16,830||8||228||9||$1,861||19||$14,968|
|June 12, 2021||26||$27,238||15||209||19||$25,602||7||$1,636|
|June 5, 2021||15||$15,539||13||100||13||$14,709||2||$600|
|May 29, 2021||35||$20,279||11||145||28||$18,64||7||$1,639|
|May 22, 2021||24||$53,208||14||174||17||$51,047||7||$2,161|
|May 15, 2021||18||$10,620||13||220||11||$5,870||7||$4,809|
|May 8, 2021||17||$10,400||11||156||15||$8,386||2||$2,500|
|May 1, 2021||21||$7,200||16||115||12||$3,808||9||$3,392|
|April 24, 2021||8||$20,200||9||31||8||$20,200||0||0|
|April 17, 2021||14||$6,270||8||102||11||$4,0180||3||$2,260|
|April 10, 2021||15||$8,940||13||129||14||$7,990||1||$950|
|April 3, 2021||18||$19,513||10||151||12||$16,923||6||$2,590|
|March 27, 2021||27||$13,942||15||244||14||$4,300||13||$9,633.5|
|March 20, 2021||11||$2,046||4||102||3||$270||8||$1,776|
|March 13, 2021||15||$3,270||9||109||6||$538||9||$2,732|
|March 6, 2021||24||$13,617||10||196||13||$10,395||11||$3,222|
|February 27, 2021||19||$8,105||12||139||15||$4,970||4||$3,135|
|February 20, 2021||9||$8,820||9||153||8||$8,520||1||$300|
|February 13, 2021||12||$4,852.6||7||81||7||2,766||5||$2,086.6|
|February 6, 2021||18||$9,752||13||153||14||$5,222||4||$4,530|
|January 30, 2021||18||$9,449||9||182||15||$8753.8||3||$695.3|
|January 23, 2021||14||$8,150||8||118||6||$4,000||8||$4,150|
|January 16, 2021||17||$6,783||13||138||11||$2,400||6||$4,382.9|
|January 9, 2021||22||$6,829||14||135||18||$3,139.3||4||$3,690|
|January 2, 2021||7||$1,466||7||60||7||$1,466||0||0|
|December 26, 2020||18||$15,900||12||163||16||$5,300||1||$600|
|December 19, 2020||18||$9,769||14||110||14||$8,426||4||$1,343|
|December 12, 2020||10||$7,200||9||100||9||$3,325||1||$3,830|
|December 5, 2020||15||$4,261||9||122||9||$2,780||6||$1,481|
|November 28, 2020||19||$7,758||10||110||13||$4,003||6||$3,755|
|November 14, 2020||14||$864.1||14||157||12||$289.1||2||$575|
|November 7, 2020||13||$6,332||9||129||9||$2,483.5||4||$3,849|
|October 31, 2020||10||$3,995.8||8||103||6||$3,231.1||4||$754.7|
|October 24, 2020||6||$18,100||6||58||5||$17,709||1||$350|
|October 17, 2020||8||$351.9||5||55||8||$351.9||0||0|
|October 10, 2020||7||$5,229||3||50||4||$735||3||$4,494|
|October 3, 2020||14||$21,428||9||173||9||$17,535||5||$3,893|
|September 26, 2020||10||$12,770||8||93||5||$10,300||5||$2,470|
|September 19, 2020||14||$8,365||9||101||6||$1,020||8||$7,345|
|September 12, 2020||6||$4,406||8||59||3||$1,270||3||$3,136|
|September 5, 2020||11||$5,191||8||117||9||$4,061||2||$1,130|
|August 29, 2020||11||$2,531||9||94||5||$1,130||6||$1,401|
|August 22, 2020||18||$6,574||12||140||7||$1,930||11||$4,644|
|August 15, 2020||13||$4,991||10||97||7||$1,216||6||$3,775|
|August 8, 2020||12||$32,092||11||112||9||$30,457||3||$1,635|
|August 1, 2020||7||$5,287||8||76||5||$3,687||2||$1,600|
|July 25, 2020||9||$18,751||6||67||7||$18,403||2||$348|
|July 18, 2020||6||$1,982.5||5||50||4||$1,407.5||2||$575|
|July 11, 2020||11||$565.1||12||75||10||$65.1||1||$500|
|July 4, 2020||10||$8,889||8||98||9||$8,788||1||$100.3|
|June 27, 2020||8||$6,874||10||50||5||$4,972.5||3||$2,081.5|
|June 20, 2020||12||$4,444||9||115||7||$2,829||5||$1,615|
|June 13, 2020||6||$3,582||4||37||2||$350||4||$3,232|
|June 6, 2020||11||$3,213.7||8||65||7||$470||4||$2,743.7|
|May 30, 2020||8||$7,335||7||48||6||$4,639||2||$2,697|
|May 23, 2020||4||$432.4||4||34||3||$432.4||1||0|
|May 16, 2020||6||$310||6||34||5||$310||1||0|
|May 9, 2020||18||$5,630||16||124||14||$3,180||4||$2,450|
|May 2, 2020||15||10,400||10||90||8||$1,900||7||$,8,500|
|April 25, 2020||8||$3,400||9||36||5||$1,000||3||$2,450|
|April 18, 2020||19||$9,500||14||92||8||$185.7||11||$9,360|
|April 11, 2020||12||$6,000||9||40||5||$190||7||$5,800|
|April 4, 2020||14||$8,200||11||68||10||$2,200||4||$6,000|
|March 28, 2020||16||$6,500||13||96||10||$3,700||6||$2,800|
|March 21, 2020||11||$11,910||7||33||7||$2,250||4||$9,960|
|March 14, 2020||7||809.8||6||34||6||684.8||1||125|
|March 7, 2020||16||$2,500||15||70||13||$669||3||$1,400|
|February 29, 2020||13||$15,260||13||128||11||$11,760||2||$3,500|
|February 22, 2020||12||$3,700||10||92||10||$2,560||2||$1,130|
|February 15, 2020||16||$1,250||10||84||12||$35||4||$1,222|
|February 8, 2020||18||$6,080||14||123||14||$2,595||4||$3,485|
|February 1, 2020||21||$20,900||12||101||14||$17,860||7||$3,060|
|January 25, 2020||13||$7,430||13||62||12||$6,430||1||$1,000|
|January 18, 2020||23||$9,580||15||120||19||$6,580||4||$3,000|
|January 11, 2020||21||$14,200||18||199||16||$1,020||5||$13,200|
|January 4, 2020||22||$6,400||11||119||16||$3,204||6||$3,245|
|December 28, 2019||22||$7,150||19||175||18||$6,800||4||$327.4|
|December 14, 2019||24||$36,300||23||167||19||$9,500||5||$26,800|
|December 7, 2019||11||$10,400||11||55||7||$1,082||4||$9,370|
|November 30. 2019||14||$2,450||12||126||12||$1,760||2||$692.5|
|November 23, 2019||16||$1,995||10||41||11||$615||5||$1,380|
|November 16, 2019||15||$3,820||13||135||11||$2,500||4||$1,271|
|November 9, 2019||25||$12,900||17||182||23||$12,200||2||$575|
|November 2, 2019||10||$2,470||12||61||9||2,450||3||$22|
|October 26, 2019||12||$5,560||14||70||11||$3,860||1||$1,700|
|October 19, 2019||8||$6,600||8||138||8||$6,600||0||0|
|October 12, 2019||19||$4,300||14||55||16||$3,800||3||$500|
|October 5, 2019||18||$14,500||19||166||15||$11,100||3||$3,400|
|September 28, 2019||19||$8,100||18||132||18||$7,560||1||$550|
|September 21, 2019||14||$6,300||16||66||11||$2,160||3||$4,170|
|September 14, 2019||15||$23,800||12||56||11||$21,250||4||$2,570|
|September 7, 2019||17||$3,500||15||98||14||$1,900||3||$1,600|
|August 31, 2019||5||$8,700||6||50||5||$8,700||0||0|
|August 24, 2019||16||$10,000||14||82||15||$4,250||1||$5,750|
|August 16, 2019||10||$1,680||5||52||7||$650||3||$950|
|August 9, 2019||17||$17,700||15||68||14||$3,900||3||$13,800|
|August 2, 2019||13||$5,760||12||108||13||$5,760||NA||NA|
|July 27, 2019||11||$7,300||13||76||8||$6,570||3||$730|
|July 20, 2019||13||$11,800||13||125||11||$5,300||2||$6,500|
|July 13, 2019||10||$775||7||46||8||$542.5||2||$233|
|July 6, 2019||7||$2,500||9||85||7||$2,500||0||0|
|June 29, 2019||23||$8,290||15||154||17||$2,300||6||$5,970|
|June 22, 2019||17||$10,700||10||139||14||$7,700||3||$3,000|
|June 15, 2019||11||$13,500||14||160||11||$13,500||NA||NA|
|June 8, 2019||13||$2,870||17||55||11||$1,570||2||$1,300|
|June 1, 2019||10||$4,460||11||60||8||$4,140||2||$315|
|May 25, 2019||17||$4,360||14||79||14||$3,700||3||$612|
|May 18, 2019||22||$9,000||17||150||16||$3,400||6||$5,600|
|May 11, 2019||18||$19,800||17||177||15||$18,300||3||$1,500|
|May 4, 2019||10||$7,075||6||32||8||$6,900||2||$175|
|April 27, 2019||15||$3,200||14||117||14||$3,160||1||$40|
|April 20, 2019||13||$13,500||10||90||9||$12,200||4||$1,300|
|April 13, 2019||16||$38,900||14||91||14||$37,800||2||$1,100|
|April 6, 2019||12||$6,870||11||94||10||$6,730||2||$50|
|March 30, 2019||15||$6,470||12||84||10||$7,91.5||5||$5,677|
|March 23, 2019||18||$6,450||14||91||14||$5,042||4||$1,408|
|March 16, 2019||14||$10,180||12||115||11||$8,800||3||$1,300|
|March 9, 2019||9||$1,800||6||49||8||$1,300||1||$500|
|March 2, 2019||20||$3,033||16||107||14||$1,817||6||$1,262|
|February 23, 2019||12||$2,040||8||69||9||$614.6||3||$1,430|
|February 16, 2019||16||$9,970||18||77||16||$9,970||0||0|
|February 9, 2019||14||$6,400||10||110||14||$6,400||0||0|
|February 2, 2019||18||$6,740||15||99||16||$5,720||2||$950|
|January 26, 2019||13||$2,770||11||67||11||$918.95||2||$1,850|
|January 19, 2019||15||$3,819||16||76||12||$2,594||3||$1,225|
|January 12, 2019||18||$7,283||14||92||15||$1,683||3||$5,600|
|January 5, 2019||10||$529||12||50||10||$529||0||0|
|December 22, 2018||17||$2,570||13||87||14||$941||3||$1,629|
|December 15, 2018||10||$2,860||8||26||8||$264||2||$2,600|
|December 8, 2018||15||$1,819||16||65||12||$552||3||$1,267|
|December 1, 2018||12||$7,500||10||90||9||$1,200||3||$6,200|
|November 28, 2018||15||$4,500||11||107||14||$4,000||1||$500|
|November 19, 2018||18||$6,137||13||98||13||$2,142||5||$3,995|
|November 14, 2018||18||$9,200||13||152||15||$8,500||3||$694|
|November 6, 2018||16||$17,300||16||183||14||$16,361||2||$950|
|October 29, 2018||14||$14,400||18||127||17||$13,800||1||$600|
|October 24, 2018||13||$6,140||13||126||11||$5,122||2||$1,018|
|October 17, 2018||18||$18,390||15||125||14||$12,292||4||$6,098|
|October 10, 2018||29||$3,149||18||104||20||$1,647||9||$819|
|October 2, 2018||18||$9,300||11||67||14||$7,300||4||$2,000|
|September 25, 2018||13||$7,000||11||75||10||$6,000||3||$995|
|September 18, 2018||9||$3,570||7||44||9||$3,570||0||0|
|September 11, 2018||13||$5,900||10||132||13||$5,900||0||0|
|September 7, 2018||14||$5,000||15||86||11||$4,000||3||$1,000|
|August 29, 2018||15||$20,700||14||79||13||$4,700||2||$16,000|
|August 20, 2018||10||$12,400||11||53||8||$11,380||3||$1,057|
|August 14, 2018||12||$19,900||12||132||9||$18,889||3||$1,011|
|August 7, 2018||16||$68,600||11||106||13||$67,259||3||$1,340|
|July 31, 2018||15||$15,100||15||95||11||$13,060||4||$2,060|
|July 23, 2018||13||$2,130||15||60||10||$1,804||3||$1,100|
|July 17, 2018||14||$5,370||17||98||9||$4,310||5||$1,100|
|July 9, 2018||16||$11,200||15||74||10||$11,080||6||$862|
|July 3, 2018||13||$7,000||7||81||12||$6,330||1||$750|
|June 25, 2018||15||$8,800||13||97||9||$4,970||6||$3,930|
|June 18, 2018||13||$14,200||14||80||7||$221||6||$14,290|
|June 11, 2018||12||$6,300||8||96||8||$5,910||4||$803|
|June 6, 2018||13||$14,500||10||88||8||$14,154||5||$579|
|May 31, 2018||11||$4,890||10||63||8||$3,240||3||$1,790|
|May 22, 2018||15||$20,400||11||63||9||$19,808||6||$885|
|May 15, 2018||15||$4,700||15||106||10||$3,900||5||$643|
|May 9, 2018||11||$1,400||13||88||9||$1,300||2||$560|
|May 1, 2018||8||$14,250||7||88||7||$13,400||1||$450|
|April 24, 2018||12||$5,300||6||61||11||$4,470||1||$800|
|April 17, 2018||9||$1,800||10||44||7||$2,330||2||$1,434|
|April 11, 2018||11||$2,500||8||32||6||$1,690||5||$809|
|April 3, 2018||15||$13,400||11||121||9||$12,020||6||$1,090|
|March 28, 2018||10||$4,000||10||92||7||$3,870||3||$215|
|March 19, 2018||17||$5,800||13||51||10||$590||7||$5,165|
|March 12, 2018||15||$3,130||11||43||11||$2,360||4||$788|
|March 6, 2018||19||$5,400||13||116||10||$1,530||9||$4,860|
|February 27, 2018||20||$6,600||13||69||14||$5,530||6||$1,030|
|February 19, 2018||15||$5,500||14||111||10||$3,990||6||$1,980|
|February 12, 2018||23||$10,900||17||157||12||$7,110||11||$3,840|
|February 5, 2018||16||$8,600||13||100||7||$1,330||9||$7,800|
|January 30, 2018||11||$12,600||11||68||5||$7,300||6||$4,982|
|January 24, 2018||19||$9,400||15||129||5||$2,010||14||$7,337|
|January 18, 2018||10||$6,280||8||49||2||$2,100||8||$4,188|
|January 9, 2018||12||$16,500||12||92||9||$15,890||3||$475|
|January 3, 2018||10||$2,500||9||47||8||$2,350||2||$150|
|December 27, 2017||15||$9,000||15||113||9||$7,568||6||$1,784|
|December 18, 2017||15||$13,800||16||164||9||$13,010||7||$1,118|
|December 11, 2017||14||$9,700||10||126||12||$2,940||4||$8,500|
|December 4, 2017||6||$1,800||6||31||5||$1,510||1||$300|
|November 28, 2017||7||$3,850||8||76||4||$3,260||3||$285|
|November 16, 2017||10||$2,700||10||48||6||$1,840||4||$856|
|November 8, 2017||15||$2,380||17||91||10||$1,860||5||$516|
|November 1, 2017||12||$4,700||17||94||9||$3,400||4||$1,300|
|October 23, 2017||15||$10,500||10||67||10||$9,780||4||$1,530|
|October 18, 2017||6||$2,000||37||3||$225||3||$1,820|
|October 10, 2017||12||$6,570||100||9||$3,880||3||$3,360|
|October 2, 2017||8||$3,100||11||19||3||$1,630||5||$1,750|
|September 25, 2017||8||$4,880||8||79||5||$2,660||5||$2,070|
|September 18, 2017||9||$4,770||3||$300||6||$4,470|
|September 12, 2017||11||$4,430||8||$2,030||3||$2,400|
|September 1, 2017||4||$1,310||3||$317||1||$1,000|
|August 23, 2017||11||$13,640||9||8||$11,840||3||$1,800|
There were 15 M&A/private equity/venture capital deals valued at $11.1 billion and three capital markets/financing transactions worth $3.4 billion. Nineteen law firms and 166 Texas lawyers were involved in all the activity.
M&A/PRIVATE EQUITY/VENTURE CAPITAL
Latham, Gibson Dunn aid on Hess Midstream’s $6.2B Hess Infrastructure deal
Hess Midstream Partners announced last week that it was acquiring Hess Corp.’s and Global Infrastructure Partners’ interests in Hess Infrastructure Partners for $6.2 billion.
The deal includes Hess Infrastructure Partners’ 80% interest in Hess Midstream’s oil and gas midstream assets, its water services business and outstanding economic general partner interest and incentive distribution rights, or IDRs, in Hess Midstream.
Latham & Watkins advised Hess Infrastructure and its partners with a corporate Houston-based deal team led by partners Thomas Brandt, Bill Finnegan and Stephen Szalkowski with associates Lauren Anderson, Eric Schoppe, Denny Lee, Paul Robe and Michael Sellner.
Houston partners Bryant Lee and Tim Fenn and associate Jared Grimley advised on tax matters; Houston partner David Miller and associates Monica White, Om Pandya and Sam Bentley assisted on finance; and Houston partner Joel Mack helped on environmental and regulatory matters. Lawyers from the firm’s Washington, D.C. office also pitched in.
Latham & Watkins also represented Hess Midstream on an exchange offer for senior notes of Hess Infrastructure and Hess Infrastructure Partners Finance Corp., including Miller, Brandt, White, Pandya, Bentley and associate Kate Wang. Lee and Fenn assisted on tax with associate Grimley and Mack on environmental.
Gibson, Dunn & Crutcher represented the conflicts committee of Hess Midstream’s board. Texas lawyers from the group included Houston partners Hillary Holmes and Gerald Spedale, Houston associate JP Lopez and Houston partner James Chenoweth on tax. Attorneys from the firm’s Washington, D.C., and San Francisco office helped.
Baker Botts counseled the conflict committee’s financial advisor Intrepid Partners, including Houston partner Josh Davidson and associate Jennifer Gasser. The Intrepid team was made up of John Nesland, Matt Barton, John Ed McGee and John Sellingsloh.
Goldman Sachs & Co. (led by Michael Sachs) and JP Morgan (led by Michael Johnson) provided financial advice to Hess Infrastructure while Morgan Stanley assisted Hess.
The deal has to clear regulators but should close in the fourth quarter.
Hess Midstream will convert into an “Up-C” structure in which IDR payments to sponsors are eliminated. In what’s expected to be a non-taxable transaction, public unitholders will receive newly issued securities in a new public entity to be named Hess Midstream LP that will be taxed as a corporation.
Hess Midstream’s public unitholders’ ownership of 17 million units will be converted into the same number of shares of Hess Midstream representing 6% of the new, larger consolidated entity on an as-exchanged basis. Hess Corp. and Global Infrastructure Partners will each own 47% of the new consolidated entity.
Analysts at Piper Jaffray’s Simmons Energy estimated the transaction came at an acquisition multiple of 13.7 times, broadly in-line with recent transactions. They said that the simplified structure and reduction in IDRs is positive for Hess as it enhances visibility on the investment’s sustainability and possible monetization to fund development and shareholder distributions.
Hess Midstream said the deal should be 6% earnings additive next year and 15% in 2021 and 2022 and the IDR simplification will lower its cost of capital.
Hess Midstream CEO John Hess said in a statement that the changes will create unitholder value by combining the strengths of its business model with the benefits of a new structure.
“As a result, HESM will transition from a small-cap MLP into a company with an enterprise value of more than $7.25 billion, no sponsor incentive distribution rights and a sustainable long-term structure,” he said.
Hess Midstream will assume $1.15 billion of Hess Infrastructure debt, issue 230 million of its units and pay cash of $550 million to Hess and Global Infrastructure Partners.
Around $350 million in borrowings under Hess Infrastructure’s credit facilities will be retired. Hess Midstream will assume $800 million of outstanding Hess Infrastructure notes in a par-for-par exchange and incur additional borrowings of $960 million, resulting in expected total debt of $1.76 billion at the transaction’s close.
Locke Lord, Orrick Assist on NextEra’s Meade Pipeline purchase from Cabot, others for $1.37B
As The Texas Lawbook reported last week, Juno Beach, Fla.-based NextEra Energy Partners agreed to buy Meade Pipeline Co. from Cabot Oil & Gas, AltaGas, Ares EIF and Vega Energy for $1.37 billion.
Locke Lord counseled NextEra, including Houston partners Bill Swanstrom, Eric Larson and Brandon Renken and associate Jennie Simmons.
NextEra’s in-house legal team included NextEra Energy Inc. general counsel Charles Sieving and NextEra Energy Resources general counsel Mitch Ross and senior attorneys Barry Levinson and Bobbie King.
Orrick represented the sellers, including partner Brad Gathright and associate Grace Lentz along with litigation partner Jeffrey Johnson and senior career associate Chris Richart. The Houston team had help on tax matters from the firm’s New York office and regulatory issues from its Washington, D.C., office.
Wells Fargo advised NextEra, including Hugh Babowal, Eric Fornell and Aaron Smith, and BMO Capital Markets assisted the sellers, including Christopher Dopp and Gregg Warren in Houston.
The deal includes around $90 million in capital contributions through 2022 related to the pipeline’s expansion.
The purchase price works out to 13.1 times this year’s EBITDA, which is in-line with recent long-haul transactions but variances exist in counterparty credit quality, analysts at Tudor, Pickering, Holt said in a note.
Meade Pipeline holds a 39% stake in the Central Penn Line, a 185-mile intrastate natural gas pipeline in Pennsylvania that’s 61% owned by Williams Cos. It’s part of a pipeline system that’s regulated by the Federal Energy Regulatory Commission that moves natural gas in Appalachia’s Marcellus Shale region to the mid-Atlantic and southeastern regions of the U.S.
The Marcellus has long been known as lacking pipeline capacity to carry natural gas to where it’s needed, which has led some producers to flare it.
NextEra Energy Inc. chairman and CEO Jim Robo said Meade – the company’s second third-party acquisition – is expected to yield a double-digit return to its unitholders and generate a cash-available-for-distribution yield of around 14%.
NextEra plans to finance the initial purchase price with $820 million in partially amortizing project finance debt, including $760 million related to the operating project and a $60 million draw of the expansion project debt facility.
NextEra also entered into an agreement for a roughly $170 million convertible equity portfolio financing with BlackRock Global Energy & Power Infrastructure, which will get an equity interest in the pipeline (that NextEra aims to buy back) and a 1% coupon over four years. The rest of the funding will come from debt capacity at NextEra’s holding company.
Cabot said separately that the sale of its 20% stake in Meade to NextEra would bring in $256 million, which beat Tudor, Pickering, Holt’s $200 million to $225 million valuation and represents a 13 times 2019 EBITDA multiple. Cabot plans to direct the proceeds from the sale, along with free cash flow this year, to shareholder return initiatives.
“Despite a tumultuous near term outlook on the gas curve, we’re buyers of COG [Cabot] given its defensive nature, pristine balance sheet, competitive 2% dividend yield and longer term upside to a more balanced gas market in 2020,” the TPH analysts said.
Latham, V&E, Kirkland advise on Roan Resources’ $1B purchase by Warburg-backed Citizen
As The Lawbook also reported last week, Roan Resources Inc. – which was split off from bankrupt Linn Energy – agreed to be acquired by Warburg Pincus-backed Citizen Energy Operating for $1 billion.
The price includes Roan’s funded net debt of $780 million at the end of September.
Latham & Watkins represented Citizen with a Houston-based corporate team led by partner Ryan Maierson with associates Ryan Lynch, Samantha Seley, Clayton Heery, Drew Tengler-West, Ashlyn Royall and Hillarie James.
Houston partner Tim Fenn and associates Jim Cole and Michael Rowe advised on tax matters and Houston partner Catherine Ozdogan and associates Matthew Jones, Benjamin Gelfand, Jack Traylor and Brian Flynn assisted on finance issues. Attorneys in the firm’s New York, Chicago and Washington, D.C., offices pitched in on derivatives, environmental, benefits and compensation and antitrust matters.
Vinson & Elkins assisted Oklahoma City-based Roan with a team led by Houston partners Steve Gill and Alan Beck with corporate associates McCall Grimes, Andrew Schulte, Alex Lewis, Andrianna Frinzi, Farah Chranya and Layton Suchma.
Sean Becker, Stephen Jacobson, Dario Mendoza, Christie Alcalá, Gina Hancock and Mary Daniel Morgan helped with labor and employee matters, Lina Dimachkieh and Neil Clausen on tax, Guy Gribov, Brittany Simington and Jason Blackmer on finance, Matt Dobbins on environmental and Sarah Mitchell on insurance. Antitrust matters were handled by an attorney in the firm’s Washington, D.C., office.
Citi and Jefferies were financial advisors to Roan, including Stephen Trauber, Serge Tismen and Muhammad Laghari from Citi and Pete Bowden, Ralph Eads, Guy Oliphint, Greg Chitty and Victor Sinn from Jefferies. BofA Merrill Lynch was Citizen’s financial advisor, including Brad Hutchinson, who joined the investment bank in 2015 from Barclays.
Roan stockholders will receive $1.52 in cash for each of their shares. The offer represents a premium of 24% over the company’s closing price Monday.
The parties expect to close the deal in the fourth quarter of this year or the first quarter of next year if it clears Roan stockholders and regulators.
Debt financing is being provided by JPMorgan Chase Bank, BMO Harris Bank, the Toronto Dominion Bank (New York branch) and BofA Merrill Lynch. Equity financing will be provided by investment funds affiliated with Warburg Pincus and Citizen Energy.
Roan was formed in 2017 as a joint venture between Linn and JVL Advisors-backed Citizen Energy II to develop 140,000 acres in Oklahoma (JVL being an oil and gas asset manager run by former Morgan Stanley banker John Lovoi). It went public last year.
Roan appointed Rick Gideon as CEO. Gideon previously was senior VP of U.S. operations at Devon Energy Corp. for four years and general manager of the Mid-Continent region and drilling and completions at HighMount Exploration & Production for six years. Before that, Gideon held senior positions at Linn and Dominion Energy Inc.
Roan said it will temporarily cut its drilling and development activity and suspend all completion activity to allow Gideon time to assess the company’s operations plan.
Sidley advises Kimmeridge Energy Management on $800M raise for fifth fund
New York private equity firm Kimmeridge Energy Management Co. said Oct. 2 it raised $800 million for Kimmeridge Energy Fund V, which is twice the size of its previous fund.
Sidley Austin advised Kimmeridge with a team in Boston and New York that included Texas partner Irving Rotter, who is co-leader of the firm’s energy practice with offices in New York and Houston. Kimmeridge didn’t use a placement agent.
Including previous fundraises and co-investments, Kimmeridge has raised $2.8 billion of limited partner commitments since the firm’s founding in 2012.
Fund V is focused on continuing Kimmeridge’s strategy of directly acquiring and developing unconventional assets in top-tier basins. The fund received support from endowments, foundations, family offices and sovereign wealth funds.
Ben Dell, Kimmeridge’s co-founder and managing partner, said in a statement that the firm believes the current E&P landscape presents compelling investment opportunities at attractive entry points.
Kirkland advises on Brookfield’s sweetened $600M offer for Teekay
Kirkland & Ellis advised Brookfield Business Partners and its affiliates and institutional partners on its sweetened $600 million take-private offer for the units it doesn’t own of Teekay Offshore Partners.
Brookfield said Oct. 1 it will acquire all of the units it doesn’t already own at $1.55 in cash per unit or one newly designated unlisted Class A common unit of the partnership per common unit. It already holds 73%.
The Kirkland team was led by Houston corporate partners Doug Bacon, Matt Pacey and Kim Hicks and included M&A partner Marc Lipscomb and associates Taylor Anthony in Dallas and Tyler Dunphy and Brittany Scheier in Houston.
Others on the team were Houston capital markets partner Bryan Flannery and associates Caleb Lowery and Austin Elliott; Houston debt finance partner Mary Kogut Brawley and associate Mahalia Burford; and tax partner Mark Dundon with help from partners in the firm’s New York office.
Employee benefits was handled out of the firm’s Chicago office, executive compensation in New York, labor and employment in Washington, D.C. and antitrust out of Chicago and London.
Bracewell represented Evercore, which was the the financial advisor to the board of Teekay’s general partner. The team included Houston partner Will Anderson and associates Benjamin J. Martin and Sarah Ashley Byrd. Potter Anderson & Corroon advised the committee.
Brookfield improved its offer from an initial $1.05 per unit in May after criticism from some Teekay shareholders, including JDP Capital Management. The new offer represented a 33% premium.
“Even a conservative valuation of Teekay Offshore would put the value well above $4 per share based on contracted cash flows with oil majors, a strong balance sheet and a sector in the early stages of a major rebound,” JDP managing partner Jeremy Deal said in a letter to Teekay’s board in June.
Teekay Offshore provides midstream services to the offshore oil production industry, including the North Sea, Brazil and the East Coast of Canada. It has consolidated assets worth $5.2 billion, including of floating production and offloading units, shuttle tankers, floating storage and offtake units, long-distance towing and offshore installation vessels and a maintenance and safety unit.
DLA Piper advises Q2 on $510M purchase of Precision Lender
Austin-based digital banking and lending services provider Q2 Holdings said Oct. 1 it had agreed to purchase Lender Performance Group, known as PrecisionLender, for $510 million in cash.
Barry Benton is Q2’s senior VP and general counsel and a former partner at Glast Phillips & Murray. Scott Kerr is Q2’s VP and deputy general counsel and a former DLA Piper associate.
Q2 said the deal expands its commercial banking solution offerings and addressable market.
Based in Charlotte and founded in 2009 by CEO Carl Ryden, PrecisionLender helps 150 banks globally to structure and negotiate commercial lending transactions. It has 150 employees.
Its product Andi has access to pricing and profitability data on millions of customer relationships and more than $1.7 trillion of transactions annually.
Q2 CEO Matt Flake said in a statement that the combination of PrecisionLender, Cloud Lending and its expanding corporate banking capabilities position the company as the leader in digital transformation solutions for commercial banking.
Q2 expects to close the deal in the fourth quarter if it clears regulators. It anticipates the deal boosting its revenue growth next year and integration costs of $6 million to $8 million and acquisition-related costs of about $5 million.
Q2 went public in 2014, raising $101 million. In December, it bought Atlanta-based fintech startup Gro Solutions for an undisclosed sum.
Akin, Shearman, Sidley aid on Rattler Midstream’s $355M acquisition of Reliance with Oryx
Midland-based Rattler Midstream, a unit of Diamondback Energy Inc., and Stonepeak Infrastructure Partners-backed Oryx Midstream announced Oct. 3 that they were acquiring Reliance Midstream unit Reliance Gathering for $355 million in cash.
Rattler will own 60% of Reliance while Oryx will hold 40% and operate the system. The parties expect to close the transaction in the fourth quarter.
Akin Gump Strauss Hauer & Feld advised Rattler with a team led by partners Lisa Hearn, John Goodgame and Seth Molay. They were joined by corporate partner Alan Laves, oil and gas partner Gabe Procaccini, tax partner Jocelyn Tau and oil and gas associates Dimitri Tagaropulos and Allyson Li.
Shearman & Sterling assisted Oryx, including partners Sarah McLean, Todd Lowther and Omar Samji in Houston and John Russel Denton in Austin along with Houston associates Kelli Sims and Douglas Goldstein on M&A and and Devon Yamauchi, Julia Pashin and Molly Harding on tax. The team had assistance from attorneys in the firm’s New York and London offices.
Jefferies was Reliance’s financial advisor, including Pete Bowden, Brian Conner and Diggs Gully.
The deal involves a crude oil gathering system with 230 miles of gathering and regional transportation pipelines, 200,000 barrels of crude oil storage in Midland, Martin, Andrews and Ector counties and throughput of 110,000 barrels per day from six oil and gas operators, including Diamondback.
More than 160,000 gross acres in the Northern Midland Basin are dedicated under long-term, fixed-fee agreements, some of which have from minimum volume commitments. The top three producers contributing more than 85% of this year’s throughput through July have, on average, more than 10 years of dedication remaining. Diamondback operates 38% of the dedicated acreage and produced about 35% of the volumes on the system through July of this year.
Travis Stice, CEO of Rattler’s general partner, said in a statement that Diamondback – through Rattler – will now participate in transporting crude oil from the wellhead through the Reliance gathering system and the Epic Crude Pipeline to docks and refineries around Corpus Christi.
“The acreage dedicated to Reliance Gathering encompasses some of Diamondback’s highest rate of return projects and deepest levels of inventory at current activity levels, which we expect will support continued production growth for years to come,” he said.
Oryx CEO Brett Wiggs said the acquisition marks the company’s entry into the Midland Basin, solidifies it as a pure-play, crude oil pipeline operator and further enhances its ability to serve strong, high-quality producer customers, “both new and existing.”
Haynes and Boone assists Contango on $132M White Star asset purchase
Haynes and Boone said Oct. 1 that Dallas partner Eli Columbus led a team of lawyers and professionals representing Contango Oil & Gas Co. on its agreement to acquire assets of White Star Petroleum and affiliates as a part of White Star’s Chapter 11 bankruptcy 363 sales process.
Assisting Columbus were partners Austin Elam in Houston and Matt Ferris in Dallas. An associate in the firm’s Denver office, Chris Reagen, also pitched in as did its professional landman Randy Browne in Houston.
Sullivan & Cromwell is assisting White Star on the bankruptcy and 363 sale.
According to the agreement announced Sept. 27, Contango will acquire 315,000 net acres in Oklahoma from White Star split into the three operating districts. The parties expect to close the transaction in the fourth quarter.
Oklahoma City-based White Star was founded by the late Aubrey McClendon, who at one time headed Chesapeake Energy Corp. The company filed for bankruptcy in Delaware in May citing low production and high operating costs.
Houston-based Contango says it focuses on maximizing production and cash flow from its properties in the shallow waters of the Gulf of Mexico and onshore properties in Texas and Wyoming – and uses that cash flow to explore, develop, exploit, increase production from and acquire crude oil and natural gas properties in West Texas, the Texas Gulf Coast and the Rocky Mountain regions of the U.S.
Fort Worth real estate billionaire John Goff last year bought a big stake in Contango, joined the board and helped install new leadership. The company’s founder and CEO Kenneth Peak died in 2013.
Last month, Contango paid $23 million for Will Energy Corp.’s 159,872 net acres in North Louisiana and the Western Anadarko Basin in western Oklahoma and the Texas Panhandle. Gibson Dunn & Crutcher’s Houston office represented Contango on that purchase plus a public offering of common stock and private placement of convertible preferred stock worth $50 million.
V&E, Bracewell aid on Plains All American’s $130M JV with Holly
Vinson & Elkins said Oct. 3 it advised Plains All American Pipeline on the formation of a $130 million 50/50 joint venture with Holly Energy Partners to develop and build a new 160,000 barrel per day common carrier crude oil pipeline in Oklahoma.
Houston partner Doug Bland led the corporate team with assistance from senior associate Matthew Falcone and associates Nettie Downs, Erin Mitchell and Madison Guidry. Partner John Lynch and associate Neil Clausen advised on tax matters.
Richard McGee is general counsel of Plains, Megan Prout is senior VP of commercial law and litigation and Carol Sandvick is VP of law, mergers and acquisitions.
Bracewell said Holly’s in-house counsel included acting general counsel Vaishali Shah Bhatia and assistant general counsel. Matthew H. Marchant.
The pipeline will connect the Cushing, Okla., crude oil hub to the Tulsa, Oklahoma refining complex owned by a unit of HollyFrontier Corp. The JV, called Cushing Connect Pipeline & Terminal, also will own and operate 1.5 million barrels of crude oil storage in Cushing, Okla.
The parties expect the JV terminal to be in service during the second quarter of 2020 and the pipeline in the first quarter of 2021. They’ve entered into long-term commercial agreements to support the assets.
The JV will contract with an affiliate of Holly Energy to manage the construction and operation of the pipeline and with an affiliate of Plains to manage the operation of the terminal, which Plains contributed to the JV at a value of around $40 million.
The parties expect the JV to generate an initial annual EBITDA multiple of around 8 to 9 times once the terminal and pipeline are placed into service by the JV.
George Damiris, CEO of the general partner of Dallas-based Holly Energy, said in a statement that the JV will provide growth to Holly Energy by insourcing logistics spending and providing the capability to supply all of HollyFrontier’s Tulsa refinery crude throughput – thus generating growth for Holly Energy while providing HollyFrontier with long-term control of a strategic asset.
Jeremy Goebel, executive VP of commercial at Houston-based Plains, said that the investment expands the company’s relationship with a key operational hub service customer and provides additional long-term alignment on movements to the Tulsa refinery.
Pillsbury advises Upland on $26.4M purchase of InGenius
Austin-based Upland Software announced Oct. 1 that it purchased InGenius for $26.4 million in cash. An additional $3 million in cash may be paid in 12 months subject to indemnification claims.
Pillsbury Winthrop Shaw Pittman advised Upland, including partner Steve Tyndall in Austin. Fasken provided advice on Canadian law issues. InGenius used LaBarge Weinstein.
Upland said the acquisition is within its target price range of 5 to 8 times pro forma adjusted EBITDA and will generate at least $4 million in adjusted EBITDA per year once fully integrated. The company expects the acquisition will be immediately accretive to Upland’s adjusted EBITDA per share.
InGenius provides computer telephony integration solutions for enterprise contact centers.
“With InGenius, Upland … can now offer the first multi-channel, knowledge-driven contact center agent productivity solution suite that integrates leading CRM and contact center platforms enabling enterprises to offer a personalized, real-time customer experience,” Upland chairman and CEO Jack McDonald said in a press release.
McDonald said the transaction is immediately accretive to adjusted EBITDA per share and takes the company to run rates of $237 million in annualized revenue and $89 million in annualized adjusted EBITDA. InGenius generates $9 million in annualized sales.
Upland closed two accretive acquisitions in the second quarter and two additional accretive acquisitions since the beginning of the third quarter. “Our acquisition pipeline remains robust; our war chest has been reloaded; [and] we are active in the market for additional acquisitions,” he said.
Abraxas Petroleum sells $7.9M in assets in South and West Texas
Oil and gas producer Abraxas Petroleum Corp. said Oct. 3 it sold two non-core asset packages to unnamed buyers for $7.9 million.
Abraxas’ outside counsel couldn’t be ascertained by press time, but Dykema partner Jeff Gifford has advised it in the past. Cameron Gulley is its in-house counsel, according to Gulley’s LinkedIn profile.
Both transactions are subject to certain due diligence and closing conditions but are intended to close within the next 45 days.
One divestiture makes up all of the company’s remaining South Texas assets while the other is a non-operated acreage position in Reeves County, West Texas. The combined assets produced on average around 310 barrels of oil equivalent in August, 49% of which was crude oil.
This past May Abraxas agreed to sell its interest in certain non-operated properties in the Williston Basin in North Dakota to an undisclosed buyer for $15.5 million.
Winston represents Arbor on recap of the Bakery Cos.
Winston & Strawn said Oct. 1 it represented private equity firm Arbor Investments on the recapitalization of the Bakery Cos. Terms weren’t disclosed.
The team was led out of Chicago but included Dallas partner Andrew Betaque. Bass, Berry & Sims was Baker Cos.’ legal counsel.
Founded in Nashville, Tenn., in 1996 by Cordia and Tom Harrington, Bakery Cos. makes fresh and frozen breads, baked goods and dough products for foodservice, food manufacturing and retail customers.
With the partnership, Cordia Harrington – who is known as “the Bun Lady” – will unite with baking industry veterans Yianny and George Caparos, continuing as CEO with Yianny Caparos serving as president and George Caparos becoming chief development officer. The Caparos brothers previously partnered with Arbor in Gold Standard Baking and Rise Baking.
Harrington said in a statement that deal will allow the company to invest infrastructure and facilities to help accelerate growth.
Chris Tuffin led the investment from Arbor, which is led by co-founder and CEO Gregory Purcell.
The firm focuses on investing in companies in the food and beverage industries. Besides Gold Standard and Rise Baking, Arbor has invested in Pita Bread Factory, Mexican Accent and Great Kitchens. The transaction is its fifth platform investment out of Arbor Fund IV.
Gibson Dunn, Chamberlain advise on PSI acquisition by MidOcean-backed Jones & Frank
Jones & Frank, a fueling system solution provider backed by MidOcean Partners, said last week that it acquired Petroleum Solutions Inc., or PSI, for an undisclosed sum.
Gibson, Dunn & Crutcher counseled Jones & Frank with Dallas associate Louis Matthews serving on the team, which was led out of Washington, D.C., and New York.
Chamberlain, Hrdlicka, White, Williams & Aughtry represented PSI, including partner Juan Vasquez Jr., Stuart Clements, Patrick Sheets, David Calvillo, Katherine Noll, Jillian Foerster and Joshua Sutin. Pasadera Capital was PSI’s financial advisor.
Founded 50 years ago and led by Tom and Mark Barron and John Keller, PSI is an Edinburg, Texas-based provider of petroleum equipment distribution, maintenance and installation services to customers across Texas.
Jones & Frank said the combination will further strengthen its position in the petroleum equipment industry and better serve its customers’ fueling equipment needs in Texas and the greater southwestern U.S. and Gulf Coast markets.
Jones & Frank CEO Keith Shadrick said in a press release that PSI’s capabilities will bolster Jones & Frank’s sales, service and installation networks. Mark Barron and John Keller are staying on while CEO Tom Barron intends to retire after consulting the company during the transition period.
MidOcean managing director Barrett Gilmer said the acquisition of PSI is consistent with the firm’s strategy of building the petroleum equipment industry’s leading solution provider.
Jones & Frank serves retail fueling stations, commercial and government fleets and emergency power customers through its 32 branch offices, 4 distribution centers and 1,000 employees, including 480 service and installation technicians across the U.S. It represents such products as Gilbarco/Veeder-Root, VeriFone, OPW, Franklin Fueling and Containment Solutions.
Shearman counsels Centina on sale to Ciena
Publicly traded telecom networking equipment provider Ciena Corp. said it agreed to buy privately-held Centina, an Austin provider of service assurance analytics and network performance management solutions.
Centina’s technology and engineering expertise will be integrated into Ciena unit Blue Planet.
Hanover, Md.-based Ciena said the acquisition is intended to accelerate Blue Planet’s strategy of providing closed-loop, intelligent automation solutions that help communications service providers improve operational agility while delivering a differentiated customer experience.
“The acquisition of Centina advances Blue Planet’s position as an emerging leader in operational support systems (OSS), focused on closed-loop automation,” Blue Planet senior VP Rick Hamilton said in a statement.
HID Global acquires Placard
Austin-based HID Global, a unit of Sweden’s Assa Ablo Group, said Sept. 30 it acquired Placard, the largest maker of secure cards in Australasia, for an undisclosed sum.
HID’s general counsel is Karen Higgins and its general counsel of intellectual property is Chris Kirby, who told The Texas Lawbook that associate general counsel Andrew Phillips worked on the deal.
HID, which claims to be a worldwide leader in trusted identity solutions, said the acquisition will enhance its presence in the region.
Placard produces driver’s licenses, health insurance cards and government IDs as well as bank cards, retail loyalty cards, monetary gift cards, public transportation cards and other cards used for enterprise applications.
HID CEO and president Stefan Widing said in a statement that adding Placard to its portfolio expands its value-add services and enhances its trusted identity capabilities while striking the balance between offering a range of card solutions and providing customers with the choice of digital IDs “as the next wave of the future.”
Placard will become a part of HID’s Identification Technologies unit.
Placard provides in-house design, printing, manufacturing, personalization and distribution services for its cards. Visa, MasterCard, China Union Pay and American Express have accredited its manufacturing and bureau facilities.
Placard CEO Chris Nunis said becoming part of HID will add innovative technology to the company’s offerings, expanding its ability to serve customers in Australasia.
HID also announced Oct. 3 that it acquired LUX-IDent, a provider of radio frequency identification components in the Czech Republic.
Akin Gump advises Noble Energy on $1B tender offer, $1B notes offering
Akin Gump Strauss Hauer & Feld said Oct. 3 it advised Noble Energy on two transactions.
Noble announced the pricing of its previously announced cash tender offer for its $1 billion in 4.15% notes due 2021, which expired on Sept. 30. It also announced an offering of $500 million in 3.250% notes due 2029 and $500 million in 4.200% notes due 2049.
Houston partner John Goodgame and counsel Cynthia Mabry led the team on both transactions. They had assistance from partner Chip Cowell and associates Kevin Schott, Litian Chen, Tyler Conte and Calvin McKnight, with partner Jocelyn Tau providing tax advice.
Noble’s general counsel is Rachel Clingman, who joined the company from Australia’s BHP Billiton last year. She said in an email response to The Lawbook that the transaction’s legal lead was Jay Ingram, managing counsel for U.S. onshore operations.
Noble operates assets onshore in the U.S. and offshore in the Eastern Mediterranean and off the west coast of Africa.
Latham & Watkins Advises LyondellBasell in $1B Public Offering of Guaranteed Notes
Latham & Watkins said Oct. 2 that it advised LyondellBasell on a $1 billion public offering of 4.200% guaranteed notes due 2049.
The Houston team was led by partners Michael Chambers and John Greer with associates Ryan Lynch, Madeleine Neet and Kate Wang. Davis Polk assisted the underwriters, who included Mizuho Securities USA and Wells Fargo Securities.
LyondellBasell’s chief legal officer is Jeff Kaplan, who joined the company in 2009. The University of Texas-trained lawyer previously worked at Chevron Phillips Chemical Co. and was in private law practice in Houston.
The notes will be fully and unconditionally guaranteed by LyondellBasell and the offering is expected to close Oct. 10.
The company plans to use the net proceeds to repay part of the indebtedness outstanding under LyondellBasell’s 364-day, $2 billion senior unsecured term loan facility.
LyondellBasell is one of the largest plastics, chemicals and refining companies in the world. It sells products into more than 100 countries and is the world’s largest producer of polymer compounds and the largest licensor of polyolefin technologies.
V&E, Kirkland work on Fortis Minerals IPO
Fortis Minerals, an EnCap Investments-backed company that owns interests in oil and natural gas minerals, filed for an initial public offering with a $100 million placeholder.
No pricing terms were disclosed, but Renaissance Capital estimates the offering could reach $400 million.
The underwriters include Credit Suisse, Goldman Sachs, Barclays, Citi, J.P. Morgan, RBC Capital Markets, Scotia Howard Weil, UBS and Wells Fargo Securities.
Fortis’ general counsel is Ashley A. Yates, who joined the company last year after serving as deputy general counsel at Rice Energy. The Vanderbilt-trained lawyer previously was an associate at V&E.
The Houston-based company was founded in 2016 and booked $138 million in revenue for the 12 months ended June 30. It plans to list on the New York Stock Exchange under the symbol NRI.
There were more than a few bankruptcies in Texas this past week. The biggest: Apollo Global Management-backed EP Energy Co., which filed with a proposal to cut $3.3 billion of its $4.9 billion in debt. With $4.98 billion in liabilities and $4.19 billion in assets, some dubbed it the largest U.S. bankruptcy of an oil and gas company since 2016. The plan would lead Apollo and Elliott Management to convert their 70% stake in the Houston company’s notes into 99% of the reorganized company’s equity. They would also backstop $325 million of its $436 million equity rights offering at a discount, along with other lenders. The restructuring plan was presented in front of Judge Marvin Isgur in Houston in U.S. bankruptcy court for the southern district of Texas. Weil, Gotshal & Manges partners Clifford William Carlson and Alfredo Perez in Houston are counseling the company with Evercore serving as financial advisor and FTI Consulting Inc. as restructuring advisor. Stroock & Stroock is counsel for the ad hoc unsecured bondholder group and Paul Weiss Rifkind Wharton & Garrison is counseling Apollo.
On the block? Warburg Pincus has put researcher RS Energy Group up for sale, according to Buyouts. RS is based in Calgary but opened an office in Houston in 2017. Warburg bought the company from ITG in 2015 for $120.5 million in cash. And Toronto-based Brookfield Asset Management is seeking a buyer for its 50% stake in Wind Energy Transmission Texas, which could fetch between $400 million to $500 million, according to Bloomberg. Canadian pension fund manager PSP Investments owns the other half, having bought it from Spain’s Grupo Isolux in 2016.
One deal we missed: This past August, Katten represented Highlander Partners’ Benestar Brands on its purchase of pork rind producer Evans Food Group from Wind Point Partners for an undisclosed sum. The team featured corporate partners Mark Solomon, Peter Bogdanow and Bill Rivers, corporate associate Alison Krieser and transactional tax planning special counsel Aaron Pinegar, all of Dallas. Katten said Highlander has experienced rapid growth over the last five years and has more than $2 billion in assets. Evans Food Group produces pork rind brands such as Mac’s, which is considered the number-one multi-outlet pork rind brand in the U.S.