The holidays may be over, but the buying hasn’t stopped. There were several large assets purchased at the end of December and through January that made for an exciting few weeks.
The biggest acquisition by far was an announcement by Regency Energy Partners that it will buy Eagle Rock Energy Partners LP’s midstream business. The $1.3 billion acquisition will complement Regency’s core gathering and processing business, and when combined with the proposed acquisition of PVR Resources, will further diversify Regency’s basin exposure in the Texas Panhandle, East Texas and South Texas.
Assets that will be acquired include approximately 8,100 miles of gathering pipeline and more than 800 million cubic feet per day of processing capacity with cash flows supported by large, long-term acreage dedications.
“This acquisition represents another attractive growth opportunity for Regency and is very strategic to our plans to increase our scale and expand our basin diversity in liquids rich areas,” said Mike Bradley, president and chief executive officer of Regency, in a company release.
The acquisition is expected to close during the second quarter.
Kinder Morgan Energy Partners had the second-biggest acquisition in the period with a $962 million purchase of American Petroleum Tankers (APT) and State Class Tankers (SCT) from The Blackstone Group and Cerberus Capital Management.
APT has a fleet of five Jones Act-qualified product tankers with 330,000 barrels of cargo capability each and SCT has commissioned the construction of four ships with the same cargo capacity. Those ships will be ready for delivery in 2015 and 2016. The acquisition is expected to close in the first quarter.
The IPO front was quiet at the end of the year except for one large offering by American Energy Capital Partners LP. The firm, headed by former Chesapeake Energy Chief Executive Aubrey McClendon, was seeking $2 billion through a public offering of 100 million common units priced at $20 each. The catch: It’s a blind offering, meaning investors won’t be able to see what the company owns prior to plunking down a minimum of $5,000.
Other smaller offerings were made by MarkWest Energy Partners LP and American Midstream Partners LP.
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