The Texas Lawbook

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CDT Roundup: 2 Weeks, 10 Deals, 8 Firms, 68 Lawyers, $742.4M

When the biggest deal news of the last two weeks is the deal that fell through, it’s generally not a sign that things are going well. And so it is with the word that Texas Capital Bancshares and the Independent Bank Group have called off their $5.5 billion merger agreement.

In terminating the agreement directors from both sides came to the mutual belief that the economic benefits of the coupling would be hard to realize in the current pandemic environment. Put simply, the rapid advance of COVID-19 and its crushing economic consequences has created an uncertain investment environment that just didn’t exist when the deal was first announced on December 9.

Their concerns are widely shared across the financial industry. In a PwC survey published in late April, finance leaders in the U.S. and Mexico were asked their top three concerns with respect to the COVID-19 outbreak. At the top (71%) was the potential financial impact on operations, liquidity and capital markets. The second (64%) was the prospect of global recession. No other concerns, including effects on the workforce, reached the 50% threshold.

Editor’s Note: Lawbook Senior Editor Allen Pusey is filling in for Claire Poole on The CDT Roundup while she is on medical leave. In her absence, the weekly report will likely be missing a lot of the historical perspective and behind-the-scenes detail that only Claire can bring to her weekly reports. But be assured that Claire will be returning as soon as possible.

To be sure, those fears were exacerbated by the uncertainties of how responses to the fast-moving virus might play out. Typical business continuity plans, PwC noted, aren’t generally tooled to the effects of a 100-year plague.

But whether or not the failure of the Texas Capital/Independent merger proves a harbinger for the year’s transactional markets, the PwC survey — as well as Texas activity reports for the past two weeks — suggests that a deep sense of caution is already the mood and the mode of the markets.

There were only 10 transactions reported, eight of them M&A, private equity or venture capital funding deals with a total reported value of $742.4 million. They involved eight different firms and 68 lawyers. The only two capital markets deals reported below were a market upgrade and a previously covered closing.

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
March 25, 202315$8,779.5101415$2,36210$6,416.5
March 18, 20237$14,048.86695$13,3452$703.8
March 11, 202321$11,5761616516$8,1315$3,445
March 4, 202320$9,6681122816$8,2094$1,459
February 25, 202313$5,3351313012$4,2351$1,200
February 18, 202314$5,743.7131588$898.76$4,845
February 11, 202316$12,0881213712$9,9654$2,123
February 4, 202317$8,0661514013$5,6144$2,452
January 28, 20237$2,1807755$1,692.752$488
January 21, 202317$5,7681617412$1,9185$3,850
January 14, 202311$2, 800101028$4213$2,400
January 7, 202318$8,2961116714$6,4613$1,835
December 31, 202214$2,732119912$2,0922$640
December 1714$7,9191311512$7,4191$500
December 10, 202214$10,093128811$7,0933$3,000
December 3, 202226$12,800.91117220$4,1416$8,659.9
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

Scary is the fact that this represents a two-week total for the weeks ending May 16 and May 23. Scarier is the fact that the same two-week period last year yielded 38 deals worth a total $13.36 billion in work done by a whopping 229 lawyers.

M&A/PRIVATE EQUITY/VENTURE CAPITAL

Norton Advises on Houston-based Flotek’s $34.4m Acquisition of JP3

Houston-based Flotek announced May 18 that it has acquired 100% ownership of privately held data and analytics company, JP3 Measurement, LLC.

The deal was a cash-and-stock transaction, valued at approximately $34.4 million, comprised of $25 million in cash and 11.5 million shares in Flotek common stock, with the assumption of $1.3MM of debt and an additional $5 million earn-out based on appreciation of Flotek’s share price.

A mostly Houston-based Norton Rose Fulbright team advised Flotek, but it was led by Dallas partner Brandon Byrne. The team included partners Robert Morris, Steve Kuntz, and Jamila Mensah, all of Houston, as well as New York partner Mara Rogers. They were assisted by senior counsel Robert Mashburn and associate Carolyn Webb, both of Houston; counsel Bob Greenslade, who splits time between Denver and Houston; associate Madison Keeble, who splits time between Austin and Dallas; senior counsel Mike Stimson of Austin and San Antonio and Dallas associate Cassidy Tennyson.

Founded in 2005, Austin-based JP3 is an energy analytics firm that analyzes and evaluates hydrocarbon inventories, including liquid and natural gas. Flotek, a publicly traded company on the NYSE is an energy industry processing research firm aimed at improving efficiencies in hydrocarbon flows and transmissions.

In acquiring JP3, Flotek acquires the company’s real-time data platforms, including the industry’s only field-deployable, inline optical analyzer. The company’s proprietary cloud visualization and analytics increase the processing efficiencies and valuations of natural gas, crude oil and refined fuels.

Flotek CEO and chairman John W. Gibson, Jr., said the acquisition will help the company endure the current difficult market cycle. “This market has created such chaos and uncertainty that numerous growth opportunities – both organic and inorganic – have emerged. We have been disciplined in vetting those opportunities with a desire to reduce our dependence on rig count and the US unconventional market, while establishing an offering in the digital transformation market.”

“With the acquisition of JP3, we are able to diversify our revenue stream and better serve our customers amidst accelerating digital transformation in the energy industry. The estimated $1 billion addressable market in the US alone provides significant revenue growth opportunities.”

“The automation of real-time analysis of flowing products brings tremendous value to the midstream energy sector and in the delivery of refined fuels. The more we know about our hydrocarbons, the more efficient, clean, safe and profitable we become as an industry,” Gibson said.

As part of the transaction, Flotek will create a new Analysis & Data division, which will be led by JP3 president Matt Thomas as a Flotek executive vice president, in addition to his continuing role as president of JP3. JP3 will continue to be headquartered in Austin.

As a part of the transaction, the sellers of JP3 have the right to nominate one member to Flotek’s Board of Directors.

V&E Advises Homeward in $20m Equity Funding

Austin-based Homeward, a home equity lending venture, announced May 14 that it had arranged $20 million in equity funding from Adam Street Partners, along with Javelin Venture Partners and LiveOak Venture Partners.

Homeward was advised by a Vinson & Elkins Austin-based team led by corporate partner Paul Tobias with associates Luke Thomas and Chris Kirby. Senior associate Ben Cukerbaum, also of Austin, advised on technology and intellectual property terms of the deal.

Homeward was founded by Texas A&M grad Tim Heyl, an Austin-based real estate entrepreneur who has specialized in leveraging technology into the home sales market. Homeward, in essence, tries to eliminate the pressures of contingency sales for homebuyers by offering presale credit for existing home equity.

In addition to the $20 million equity-based funding, Homeward also announced that it had secured an addition $85 million in debt.

In a company statement Heyl, the company’s CEO, said the new funding will allow Homeward to purchase more homes for its customers, and expand its agent partnerships.

“Despite COVID-related volatility, we’ve continued to see strong customer and agent demand for our offering. Housing inventory is low right now, but demand remains high and customers are using our non-contingent cash offers to beat out other bidders.” Heyl said.

Under terms of the deal, Jeffrey Diehl, the managing partner of Chicago-based Adam Street will join the Homeward board. Diehl led an early investment in the real estate software firm BoomTown, and he said the investment in Homeward is consistent with Adam Street’s efforts to target resilient companies that need capital to fuel growth.

“We are a selective investor, particularly in the current environment, but Homeward stood out,” said Jeffrey Diehl. “The company is growing rapidly, has strong leaders with deep industry experience, and has impressive traction with agent partners.”

“Homeward solves a long-term pain point for Realtors and their clients by making offers more competitive and home sales more certain,” said Jed Katz, of Javelin Venture Partners, headquartered in San Francisco. Katz is a founder of Move.com and Rent.Net.

“We think they have an A+ team and a solid model that’s well positioned to scale in a way the industry and the capital markets will embrace,” Katz said.

Homeward provides equity lending to homeowners intent on buying a new home. By furnishing the funding for a purchase upfront, buyers can present their offers on a new home as a cash bid. By guaranteeing a base bid from Homeward for the old property, homeowners can “rent” their new home for up to six months while their old home is listed for sale.

Conversely, Homeward customers can also stay in their old home while making improvements to their new property. They only move once and can control the timing of their move.

Homeward is currently operating in Texas, Georgia and Colorado, with plans to expand its lending and agent network nationwide.

DartPoints Receives Investment from Astra Capital Management

Dallas-based DartPoints announced May 6 that Astra Capital Management had acquired a majority interest in the edge data firm.

The company also announced that veteran telecommunications manager, Scott Willis, will become the company’s new president and CEO. The value of the private equity transaction was not disclosed.

DartPoints was represented by lawyers from the Dallas office of Barnes & Thornburg. The names of those lawyers were not available. Sheppard Mullin represented Astra Capital, which is based in Washington, D.C.

Astra Capital Management specializes in growth businesses in the communications and technology services sectors, targeting highly scalable companies with proven business models that have positive free cash flow and significant growth potential.

Founded in 2012, DartPoints is a leader in the development of edge colocation data centers, computer data centers that provide access to sophisticated data infrastructures outside Tier 1 cities. In anticipation of the investment, DartPoints announced in early April that it had achieved a positive cash flow.

Company founder Hugh Carspecken said the investment by Astra Capital will allow DartPoints to accelerate a buy-and-build strategy nation-wide. “Astra’s expertise, capital and global network combined with Scott’s leadership and vision will fuel our growth and help us meet the increasing need for edge colocation data centers.”

In addition to Willis, Astra Capital will provide three new members to the DataPoints board: Kevin Beebe, Brian Kirschbaum and Scott Bergs.

The Stanford-trained Willis most recently served for three years as president and CEO of Zinwave a developer of in-building cellular, wireless and IP services. He’s also worked at BellSouth, Ericsson and Nokia in various executive roles.

“The growth of locally consumed and generated content, the shift in use of cloud computing and the increase in application performance requirements have exposed inefficiencies in our network infrastructure,” Willis said in a statement. “DartPoints is well positioned to support the growth in edge colocation data centers across North America as digital businesses seek to move closer to their users.”

Edge colocation data centers are designed are designed to localize and intersect content from cloud providers, commercial data users and large data platforms in population centers beyond the largest cities and outside the data center cloud.

Locke Lord advises on sale by Burk Royalty of East Texas assets to ETX Energy

ETX Energy LLC announced the company had acquired East Texas oil and gas assets from Burk Royalty Co Ltd. for an undisclosed amount.

ETX Energy said it was represented by Baker Botts. Lawyers involved in the transaction were not identified, but the firm has been representing the company, formerly known as New Gulf Resources, since its emergence from bankruptcy as ETX Energy in 2016.

Burk Royalty Co was represented by a Locke Lord team led by Jason Schumacher of Dallas. Partner Will Becker and associate Joe Carmical, both of Dallas, assisted, along with Chicago-based partner Julie Dziobak.

Burk Royalty is a partnership involved in the acquisition of production properties. It was formed in 1929 in Burkburnett and moved to Wichita Falls in 1935. The company concentrates its activities in East Texas and the Permian Basin although the Company operates properties in South Texas, Panhandle of Texas, North Texas and the Ft. Worth Basin.

The properties sold consist of approximately 1,500 barrels of oil equivalent per day and 57,000 net acres of operated and non-operated leasehold interests in the Texas counties of Houston, Madison and Trinity, along with the associated gathering, processing and saltwater disposal infrastructure.

According to the company these acquisitions represent a 96% increase in ETX’s leasehold acreage position, a 71% increase in Proved Developed Reserves, and adds significant development potential from multiple producing formations. ETX now has approximately 117,000 net acres.

The company is run by David Kimbell Jr. whose father was one of the company’s founding partners. The Kimbell family remains heavily active in the firm.

ETX Energy is based in Tulsa, Oklahoma, and owns, manages and operates upstream and midstream energy projects in Southeast Texas, with its activity primarily focused in the Eastern Eagle Ford. ETX is highly experienced in the application of advanced technologies such as horizontal drilling and multi-stage fracture stimulation to maximize the value of U.S. oil and natural gas reserves.

The company’s CEO, Ralph Hill is a veteran in the upstream, midstream and downstream segments of the oil and gas industry. He previously served as president of WPX Energy where he led the 2011 WPX spin out from The Williams Companies as a pure play exploration and production company. The company’s general counsel is Kim Fink, who worked in the energy prior to gaining a law degree from the University of Tulsa College of Law.

Locke Lord Advises Crestwood Equity in $160m Acquisition from Plains All American

Crestwood Equity Partners announced last week with its first quarter results that it had acquired terminalling and storage assets from Plains All American Pipeline LP across several states.

The assets add approximately 7 million barrels of NGL storage, a multi-year supply agreement with Plains and additional access to transportation capacity from Mont Belvieu. The $160 million deal, which specifically involves natural gas liquid (NGL) storage and rail-to-truck liquid petroleum gas (LPG) terminals, was said to have closed on April 1.

Crestwood was represented by Locke Lord. The team was led by energy partner  Bill Swanstrom and senior counsel Mechelle Smith, both of Houston and included Houston partners Ben Cowan, Laura Ferguson, Sara Longtain, Mark Miller, Kevin Peter, Mitch Tiras and Jeff Wallace, as well as associates Kirby Gilbert and James Haecker , also of Houston. Senior counsel Carrie Collier-Brown of Austin pitched in, along with Dallas partners Van Jolas and Geoff Polma. San Francisco-based partner Jaremi Chilton and associate Mike Conroy of Chicago assisted.

Plains All American Pipeline, L.P. is involved in intrastate crude oil pipeline transportation and terminalling storage activities.

Crestwood Equity Partners LP is a publicly traded master limited partnership that owns and operates midstream assets located primarily in the Bakken Shale, Delaware Basin, Powder River Basin, Marcellus Shale, Barnett Shale and Fayetteville Shale.

Gibson Dunn, Baker Botts Advise Delek Entities in Dropdown Transaction

Delek US Holdings and Delek Logistics Partners LP last week announced a $48 million dropdown transaction, moving certain of the company’s trucking assets to Delek Logistics. The deal closed on May 1, according to the company.

Gibson Dunn advised the conflicts committee and Baker Botts represented Delek US.

The Gibson Dunn corporate team included Houston partner Gerry Spedale and Houston associates Stella Tang and William Bald.  Houston partner James Chenoweth and Houston associate Collin Metcalf advised on tax aspects and Dallas partner Karl Nelson weighed in on benefits. Baird was financial advisor to the conflicts committee.

The Baker Botts team was led by Houston corporate partner A.J. Ericksen with senior associate Laura Katherine Mann, associate Ieuan List and associate Shumaila Dhuka, all of Houston.

Partner Michael Bresson, also in Houston, pitched in on tax matters, along with Dallas partner Matt Larsen and Houston senior associate Jared Meier. Partner Rachael Lichman and senior associate Chad Davis, advised on finance matters from Houston, along with Dallas associate Taylor Courtade. Environmental partner Aileen Hooks, advised from Austin.

The assets and services involved in the agreement are projected to generate incremental annual earnings before interest, taxes, depreciation and amortization (EBITDA) of approximately $8 to $9 million. The agreement includes a minimum revenue commitment from Delek US to support approximately 80 – 85% of the EBITDA guidance. Delek Logistics plans to finance the dropdown through cash on hand and borrowings from its revolving credit facility. After closing, Delek Logistics has approximately $107 million available.

In a company statement Uzi Yemin, chair and CEO of Delek US said the acquisition is expected to complement current trucking operations at Delek Logistics, adding “scale and geographic diversity.” The trucking assets are currently part of the company’s refining operations in Tyler, Texas and El Dorado, Arkansas. The trucking assets are comprised of approximately 150 tractors and 150 trailers, which are primarily leased and owned, and currently transport crude oil, asphalt and other refined products.  

Delek Logistics Partners, LP, headquartered in Brentwood, Tennessee, was formed by Delek US Holdings, Inc. to own, operate, acquire and construct crude oil and refined products logistics and marketing assets.

Delek US Holdings, Inc. is a diversified downstream energy company with assets in petroleum refining, logistics, asphalt, renewable fuels and convenience store retailing.  The refining assets consist of refineries operated in Tyler and Big Spring, Texas, El Dorado, Arkansas and Krotz Springs, Louisiana with a combined nameplate crude throughput capacity of 302,000 barrels per day. The company also operates 252 convenience stories in central west Texas and New Mexico.

Baker Botts Advises Sunnova on Sale of $130 million Convertible Notes

Baker Botts announced May 13, that it had advised Sunnova Energy International Inc., a leader in residential renewable energy, on a senior unsecured convertible note facility to issue and sell $130 million of 9.75% convertible senior notes due 2025 in a private placement.

The Baker Botts Team was led by Houston partners Justin Hoffman and Travis Wofford. Support was provided from the Houston office by associates  Jack Chadderdon and Josh Dunegan, Senior Associate Sarah J. Dodson and partner Josh Davidson. Tax support came from Houston partner Mike Bresson and Partner Jon Nelsen from the firm’s Austin office.

The Facility includes a 30-day option in which the investors may purchase up to $60 million in additional notes. The notes are convertible at the option of the investors at an initial conversion rate equivalent to $13.50 per share of common stock.  The company may convert the notes after May 14, 2023.  

The investors included affiliates of Kayne Anderson Capital Advisors, L.P., who acted as lead investor, as well as Liberty Mutual Group, Newlight Partners LP, and Magnetar Capital. BofA Securities, Inc. acted as sole capital markets advisor on the transaction.

In addition, Sunnova entered into privately negotiated exchanges (the “Exchanges”) with a small number of institutional investors in its 7.75% convertible senior notes due 2027 (the “existing notes”) whereby such investors exchanged all $55.0 million aggregate principal amount of existing notes for an equal principal amount of the new notes.

Houston-based Sunnova specializes in residential solar panels and solar storage. Founded in 2012 by veteran electric utilities executive John Berger, a Texas A&M grad and Harvard Business School alum. Its general counsel is University of Texas law grad Drew Baker whose resume includes legal counsel in a variety of public and private companies.

Kirkland Counsels EIG Global Energy Partners on $350m Closing of $1.1B Fund

Kirkland & Ellis advised EIG Global Energy Partners on its final closing of EIG Global Project Fund V. Funding commitments totaled $1.1 billion, nearly 50% higher than the fund’s original $750 million target in the second closing of the fund.

EIG also raised an additional $1.5 billion of commitments in the form of separately managed accounts that will invest alongside GPF V. In total, since the first closing of GPF V in July 2019, EIG has raised $2.6 billion of commitments for its direct lending strategy.

As of March 31, EIG reports $22.4 billion under management from pension plans, insurance companies, endowments, foundations and sovereign wealth funds in Asia and Europe. The company is headquartered in Washington, D.C. with offices in Houston and other global markets. It’s portfolio companies include Aethon, ARB Midstream and Cheniere Midship and other companies with assets in Texas.

Partner Stephen Butler in Houston assisted a Kirkland team that consisted mostly of lawyers outside Texas, including Investments Partners Stephanie Berdik of Boston and Michael Chiswick-Patterson of Washington, D.C.

GPF V’s strategy is aimed at direct lending for energy and energy infrastructure operations across the board, whether they were full energy, midstream, power or renewable energy projects. EIG says more than 70% of capital commitments to the fund are from investors outside the U.S., which the company says are “reflective of the global nature of the EIG’s business.”

R. Blair Thomas, the company’s CEO, said, “Our fundraising success in the current environment is a strong testament to our investors’ enduring trust in our ability to identify and execute on attractive opportunities across the global energy and infrastructure value chain.”

EIG President Randy Wade said, “With demand for capital high and many traditional sources of capital retreating, the Fund is seeking opportunities in the global transition away from traditional hydrocarbons toward more sustainable energy production. We believe our specialized approach and disciplined underwriting with a focus on sector diversity should position us to continue to generate strong returns through market cycles.”

UPDATE/OTHER:

Latham & Watkins said it advised West Virginia-based Diversified Gas & Oil in a UK market upgrade. Diversified shares currently trading on the Alternate Independent Market are moving to the Main Market of the London Stock Exchange, the first new entrant since the outbreak of COVID-19. Although the Latham team was led out of the London office, U.S. matters were handled out of Houston by partners Jeff Muñoz and David Miller, along with New York partner Bora Bozkurt.

***

Liberty Media Corporation announced May 18 as the ex-dividend date for the distribution of subscription rights to purchase shares of Liberty’s Series C Liberty SiriusXM common stock in connection with its previously announced rights offering. Baker Botts is representing Liberty Media in the transaction, including corporate partner Samantha Crispin and tax partner Josh Mandell, both of Dallas.

Allen Pusey

Allen Pusey is a senior editor and writer at The Texas Lawbook.

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