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NGL Energy Partners acquires Magnum NGLs and 10 billion barrels of liquids storage space

10th February 2015

NGL Energy Partners LP has entered into a definitive purchase agreement with Magnum Development LLC, a portfolio company of Haddington Ventures LLC, and other Haddington-sponsored investment entities to acquire Magnum NGLs, LLC

NGL Energy Partners LP has entered into a definitive purchase agreement with Magnum Development LLC, a portfolio company of Haddington Ventures LLC, and other Haddington-sponsored investment entities to acquire Magnum NGLs, LLC
The facility is strategically located southwest of Salt Lake City, Utah with rail and truck access to western US markets

Magnum owns and operates a natural gas liquids storage facility with multiple existing salt caverns and a potential capacity of greater than 10 million barrels.

The facility is strategically located southwest of Salt Lake City, Utah with rail and truck access to western US markets.

This acquisition will enhance NGL's existing asset footprint to better support western US customers, while increasing the partnership’s fee-based revenue stream from current and future contracts on the facility.

The definitive agreement contemplates the purchase of Magnum NGLs, LLC on a debt-free basis for a purchase price of USD 280m plus working capital adjustments at closing.

The transaction is fully-financed and will be paid through a combination of USD 80m cash and USD 200m in NGL Common Units issued to seller and subject to certain lock-up provisions. The transaction is expected to be DCF neutral in the first year and significantly accretive to NGL’s DCF / LP unit thereafter, with an EBITDA multiple expected to be 7.1x in FY2017.

The consummation of the transaction is subject to customary closing conditions and is expected to close in the first quarter of 2015.

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