HOUSTON--(BUSINESS WIRE)--
Crestwood Equity Partners LP (NYSE: CEQP) (“Crestwood Equity”) and
Crestwood Midstream Partners LP (NYSE: CMLP) (“Crestwood Midstream”)
(collectively “Crestwood”) today announced the closing of the merger
between Crestwood Equity and Crestwood Midstream following approval of
the merger by Crestwood Midstream’s unitholders. Crestwood Equity’s
common units will continue to trade on the New York Stock Exchange under
the symbol CEQP, while Crestwood Midstream’s common units will cease to
be traded on the New York Stock Exchange after the close of business on
September 30, 2015.
“We appreciate the support of a substantial majority of the Crestwood
Midstream unitholders who voted in favor of the merger. We believe the
merged partnership will be better positioned to create long-term value
for our unitholders with the simplified structure and lower costs that
result from the combination,” commented Robert G. Phillips, Chairman,
President and Chief Executive Officer. “Crestwood remains focused on
delivering solid operational results during the remainder of 2015 and
new project development opportunities around our existing platform
despite the uncertainty created by the current commodity cycle and its
impact on midstream MLP valuations in the capital markets. With the
merger complete, Crestwood is well positioned in 2016 and beyond to
expand our business through long-term infrastructure investments in the
areas that we operate.”
Michael France, Managing Director of First Reserve, the substantial
owner of Crestwood’s general partner added, “We are pleased to see
significant limited partner support for the merger and believe this is
the next step to realizing the full potential of Crestwood’s business.
We know it is a difficult period for the energy industry, but we remain
committed to assisting in the growth and development of Crestwood’s
operating platform, which First Reserve believes is located in some of
the most prolific shale plays in the US. While it might take some time
to fully realize the benefits of these opportunities, given the current
commodity cycle, the simplified partnership structure should make
Crestwood more competitive for growth opportunities and therefore more
attractive to long-term midstream investors.”
Under the terms of the merger agreement, each Crestwood Midstream common
unitholder (other than Crestwood Equity and its affiliates) will receive
2.75 common units of Crestwood Equity for every one common unit of
Crestwood Midstream owned. Beginning in the third quarter of 2015,
Crestwood Midstream unitholders will begin receiving quarterly
distributions for all Crestwood Equity units received through the merger
transaction. Crestwood Equity’s annual distribution is currently $0.55
per common unit and is paid in accordance with Crestwood Equity’s
partnership agreement. Crestwood Midstream’s incentive distribution
rights were cancelled upon completion of the merger, and Crestwood
Midstream now operates as a wholly-owned subsidiary of Crestwood Equity.
In conjunction with the merger, Crestwood Midstream today entered into
an amended and restated credit agreement establishing a $1.5 billion
revolving credit facility. The five-year credit facility will be
available to fund Crestwood’s on-going working capital and capital
requirements.
Forward-Looking Statements
The statements in this communication regarding future events,
occurrences, circumstances, activities, performance, outcomes and
results are forward-looking statements. Although these statements
reflect the current views, assumptions and expectations of Crestwood’s
management, the matters addressed herein are subject to numerous risks
and uncertainties which could cause actual activities, performance,
outcomes and results to differ materially from those indicated. Such
forward-looking statements include, but are not limited to, statements
about the future financial and operating results, objectives,
expectations and intentions and other statements that are not historical
facts. Factors that could result in such differences or otherwise
materially affect Crestwood’s financial condition, results of operations
and cash flows include, without limitation, fluctuations in crude oil,
natural gas and NGL prices (including, without limitation, lower
commodity prices for sustained periods of time); the extent and success
of drilling efforts, as well as the extent and quality of natural gas
and crude oil volumes produced within proximity of Crestwood assets;
failure or delays by customers in achieving expected production in their
oil and gas projects; competitive conditions in the industry and their
impact on our ability to connect supplies to Crestwood gathering,
processing and transportation assets or systems; actions or inactions
taken or non-performance by third parties, including suppliers,
contractors, operators, processors, transporters and customers; the
ability of Crestwood to consummate acquisitions, successfully integrate
the acquired businesses, realize any cost savings and other synergies
from any acquisition; changes in the availability and cost of capital;
operating hazards, natural disasters, weather-related delays, casualty
losses and other matters beyond Crestwood’s control; timely receipt of
necessary government approvals and permits, the ability of Crestwood to
control the costs of construction, including costs of materials, labor
and right-of-way and other factors that may impact Crestwood’s ability
to complete projects within budget and on schedule; the effects of
existing and future laws and governmental regulations, including
environmental and climate change requirements; the effects of existing
and future litigation; and risks related to Crestwood’s substantial
indebtedness, as well as other factors disclosed in Crestwood’s filings
with the U.S. Securities and Exchange Commission. You should read
filings made by Crestwood with the U.S. Securities and Exchange
Commission, including Annual Reports on Form 10-K and the most recent
Quarterly Reports and Current Reports for a more extensive list of
factors that could affect results. Readers are cautioned not to place
undue reliance on forward-looking statements, which reflect management’s
view only as of the date made. Crestwood does not assume any obligation
to update these forward-looking statements.
About Crestwood Equity Partners LP
Houston, Texas, based Crestwood Equity Partners LP (NYSE: CEQP) is a
master limited partnership that owns and operates midstream businesses
in multiple unconventional shale resource plays across the United
States. Crestwood Equity is engaged in the gathering, processing,
treating, compression, storage and transportation of natural gas;
storage, transportation, terminalling, and marketing of NGLs; and
gathering, storage, terminalling and marketing of crude oil.
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Source: Crestwood Equity Partners LP