© 2013 The Texas Lawbook.
By Natalie Posgate
Staff Writer for The Texas Lawbook
(October 22) – Houston-based Plains All American Pipeline, LP (PAA) announced Tuesday that it has entered a merger agreement to acquire all shares of PAA Natural Gas Storage, LP (PNG), which will make PNG a wholly-owned subsidiary of Plains.
The all-stock transaction values PNG at $2 billion after PAA raised its offer 1.5 percent, Bloomberg reports.
Vinson & Elkins represented PAA in the deal, with Houston M&A partner Jeff Floyd as the lead attorney. On the corporate M&A end of the transaction, Floyd received assistance from others in the firm’s Houston office: partners Alan Beck and Sarah Morgan and associates Will Burns and Lauren Anderson.
Other V&E attorneys involved in the deal include Dallas partners Jim Meyer and Brian Bloom, Houston partners John Lynch and Larry Nettles, as well as Washington, D.C. partner Billy Vigdor.
The firm worked with PAA when it originally took an ownership in PNG. In 2009, V&E represented PAA when it acquired Vulcan Capital’s indirect 50 percent interest in PAA Natural Gas Storage, LLC for $220 million.
Earlier this month, V&E served as the issuer’s counsel in the $2.2 billion IPO for Plains GP Holdings, an affiliate of PAA. It is the largest IPO so far this year on the U.S. markets.
Last year, V&E represented PAA when it acquired four operating crude oil rail terminals, one terminal under development and various contractual arrangements from U.S. Development group for $500 million.
V&E also handled a big-buck acquisition for PAA in 2005 when it acquired Pacific Energy Pipeline for $2.5 billion.
Delaware law firm Richards, Layton & Finger advised PNG on the transaction.
Currently, PNG is a publicly traded master limited partnership that owns two natural gas storage facilities in Louisiana and Michigan.
PAA already owns PNG’s general partner and subordinated units as well as approximately 46 percent of PNG’s outstanding units. According to a statement from the company today, there are currently 61.2 million outstanding common units of PNG.
The deal is expected to close this year in the end of the fourth quarter.
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