© 2015 The Texas Lawbook.
By Natalie Posgate
(Sept. 18) – Denver-based Antero Resources Corporation announced Friday that it has agreed to drop down its water business to its limited partnership, Antero Midstream Partners, for $1.05 billion.
The acquisition was paid for in a combination of cash, assumed debt and Antero Midstream common units. Antero Resources is also entitled to receive two potential $125 million earn-out payments year-end 2019 and 2020 if certain fresh water volumetric delivery targets are met.
The terms of the transaction were approved by an independent conflicts committee of the board of directors of Antero Midstream’s general partner and a special committee of the board of directors of Antero Resources.
Antero Resources’ special committee turned to Houston partners Matt Strock, David Oelman and Mark Brazzil of Vinson & Elkins to lead its end of the transaction. Others from the firm’s Houston office who were on the deal included partner John Lynch and associates Will Burns, Lina Dimachkieh, Scott Rubinsky, Sean Roberts, Atma Kabad, Danielle Patterson, Megan Ceder and Davis Zapffe.
Antero Midstream’s conflicts committee turned to Houston attorneys at Baker Botts to handle its end of the deal. Corporate partner Gerry Spedale led the team and received assistance from partners Mike Bresson and Jeremy Kennedy, special counsel Chuck Campbell and associates Carina Antweil and Sarah Dodson.
To raise money for the acquisition, Antero Midstream priced a private placement of 12.9 million common stock units for gross proceeds of approximately $243 million. Upon completion of the private placement, Antero Midstream’s total cash consideration to Antero Resources will be $794 million and 10.9 million common units, plus the potential earn-out payments.
Barclays served as the sole placement agent for the private placement offering. It turned to Latham & Watkins as its legal counsel in the transaction. Houston corporate partner Ryan Maierson led the deal and received assistance from partner Tim Fenn and associates Matthew Williams, Nick Dhesi and Jim Cole, all of whom are based in the firm’s Houston office.
The acquisition is expected to close on Sept. 23.
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