Despite the oil and gas downturn in the past year, some of the mid-stream companies are surging with major purchases. Take for example the announcement by Tallgrass Energy Partners, LP. The Leawood, Kansas based firm is buying another 31.3 percent interest in Tallgrass Pony Express Pipeline LLC for $475 million cash and 6.518 million Tallgrass Energy Partners common units. Total consideration—$743.6 million.
“This acquisition demonstrates our continued commitment to execute on our strategic plan to grow TEP (Tallgrass Energy Partners) and increase the cash distributions to our unitholders, even in challenging capital market conditions,” said Tallgrass President and CEO, David G. Dehaemers, Jr. “The attractive acquisition multiple, the inclusion of equity consideration and other favorable terms of the purchase agreement showcase the supportive nature of TEP’s relationship with Tallgrass Development.”
He expects the purchase to be strong enough that the corporate leaders will recommend to the board to increase its quarterly distribution for the first quarter of 2016.
Tallgrass Energy provides crude oil transportation in Wyoming, Colorado and the Midwest regions of the U.S. including the Hugoton-Anadarko Basins and the Niobrara, Mississippi Lime, Eagle Ford and Bakken shale formations.