From a press release:
Baker Botts Represents Special Committee of Western Gas Equity Partners in Providing Partial Financing for $750,000,000 Dropdown of Assets by Anadarko to Western Gas Partners
Deal Description: February 24, 2016 – Western Gas Partners, LP (NYSE: WES) (“WES”) today announced that it has agreed to acquire a 100% interest in Springfield Pipeline LLC (“Springfield”) from its corporate sponsor, Anadarko Petroleum Corporation (“Anadarko”), for $750.0 million. WES intends to finance the acquisition, in part, by issuing 835,841 common units representing limited partner interests in WES at a price of $29.91 per common unit to the owner of its general partner, Western Gas Equity Partners, LP (NYSE: WGP) (“WGP”). WGP will fund its WES common units purchase by drawing on a new secured revolving credit facility, which will close on or before the transaction closing date.
WES also intends to finance the acquisition by issuing an additional 1,253,761 WES common units at a price of $29.91 per common unit to Anadarko, and $449 million in aggregate amount of 8.5% perpetual convertible preferred units to First Reserve Advisors, L.L.C. and Kayne Anderson Capital Advisors, L.P., at a price of $32.00 per unit. WES intends to fund the remainder of the purchase price by borrowing under its revolving credit facility. The convertible preferred unit issuance includes an overallotment feature that may result in the issuance of up to an additional $252.6 million of such units over the next 30 days, the proceeds of which would pay down WES’s revolving credit facility balance.
Springfield’s sole asset is a 50.1% interest in the Springfield oil and gas gathering system, which consists of 548 miles of gas gathering lines with a capacity of 795 MMcf/d and 241 miles of oil gathering lines with a capacity of 130 MBbls/d, located in Dimmit, La Salle, Maverick and Webb counties in South Texas. The assets to be acquired also include 24 compressor stations with centralized delivery points, 260,000 barrels of oil storage capacity and 75,000 Bbls/d of stabilization capacity.
The terms of the sale of WES common units were approved by the boards of directors of the general partners of WGP and WES. The WGP and WES boards’ special committees, which are each comprised entirely of independent directors, unanimously approved the terms of WGP’s purchase of WES common units. The terms of the acquisition and the sale of convertible preferred units were approved by the board of directors of the general partner of WES and its special committee. The transactions are expected to close by March 15, 2016.
Baker Botts represented the WGP Special Committee with respect to WGP’s purchase of WES common units. Robert W. Baird & Co. Incorporated acted as the WGP Special Committee’s financial advisor.
Client: The Special Committee of Western Gas Equity Holdings, LLC, the general partner of WGP.
Outside Counsel to Client: Baker Botts L.L.P.
Other Parties: The Special Committee of Western Gas Holdings, LLC, the general partner of WES; Anadarko, WGP, and WES; First Reserve Advisors, L.L.C. and Kayne Anderson Capital Advisors, L.P.
Inside Counsel to Company: Philip H. Peacock and Philip C. Neisel.
Outside Counsel to Other Parties: Bracewell LLP and Evercore Group L.L.C. for the Special Committee of Western Gas Holdings, LLC.
Value: Approximately $25.0 million in WGP’s purchase of WES common units; $750 million for WES’s overall acquisition.
Baker Botts Lawyers/Office Involved:
Corporate: Josh Davidson (Partner, Houston); Jennifer Wu (Associate, Austin); Jude Dworaczyk (Associate, Houston)
Tax: Chuck Campbell (Special Counsel, Houston)
Oil and Gas: Scott Looper (Associate, Houston)
Environmental: Scott Janoe (Partner, Houston); Harrison Reback (Associate, Houston)
Regulatory: Gregory Wagner (Special Counsel, Washington, D.C.)
Real Estate: Connie Simmons Taylor (Partner, Houston); Emma Stephens (Associate, Houston)