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Acquisition of pipeline and gathering systems by EQM Midstream

Published by
World Pipelines,


Equitrans Midstream Corporation (ETRN) and EQM Midstream Partners, LP (EQM) have announced that EQM has completed the acquisition of a 60% interest in Eureka Midstream Holdings, LLC and a 100% interest in Hornet Midstream Holdings, LLC for total consideration of US$1030 million, comprised of approximately US$860 million in cash and approximately US$170 million of assumed pro-rata debt. Concurrently, EQM closed the private placement of US$1.2 billion of newly issued Series A Perpetual Convertible Preferred Units (Convertible Preferred Units). A portion of the net proceeds from the private placement was allocated to the cash purchase price of the acquisition, with the remaining net proceeds to be used for general purposes.

“We are pleased to have completed this important acquisition and our team is excited to begin integrating the Eureka and Hornet systems and leveraging our existing assets and core operating capabilities,” said Diana M. Charletta, Chief Operating Officer of EQM. “We are relentless in our pursuit of becoming the low-cost provider and partner of choice across all aspects of our business. These value-enhancing assets will diversify our producer customer mix and increase exposure to wet Marcellus acreage; expand our supply hub and create additional commercial opportunities; reduce unit operating costs through increased scale; and accelerate opportunities for our water services business."

Asset overview

Eureka Midstream is a 190 mile gathering header pipeline system in Ohio and West Virginia that services both dry Utica and wet Marcellus production. Hornet Midstream is a 15 mile, high-pressure gathering system in West Virginia that connects to the Eureka system.

Advisors

Citi and Guggenheim Securities, LLC acted as financial advisors and Latham & Watkins acted as legal advisor to ETRN and EQM. Citi and Guggenheim Securities, LLC also acted as joint placement agents for the Convertible Preferred Units issuance.

Read the article online at: https://www.worldpipelines.com/business-news/11042019/acquisition-of-pipeline-and-gathering-systems-by-eqm-midstream/

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