Energy Transfer to Acquire Crestwood Equity Partners in Blockbuster Deal
Energy Transfer announced on Wednesday that it will acquire Crestwood Equity Partners for approximately $7.1 billion, including $3.3 billion in debt. Crestwood shares increased 1.2% to $26.50 in premarket trade, while Energy Transfer shares remained unchanged on the announcement.
The agreement allows Energy Transfer to enter the Powder River basin while also expanding its foothold in the Williston and Delaware basins. Crestwood’s systems, which are located across three basins, have about 2 billion cubic feet per day (bcfpd) of gas collection capacity, 1.4 billion cubic feet per day (bcfpd) of gas processing capacity, and 340,000 barrels per day (bpd) of oil gathering capability.
“These assets are expected to complement Energy Transfer’s downstream fractionation capacity at Mont Belvieu, as well as its hydrocarbon export capabilities from both its Nederland Terminal in Texas and the Marcus Hook Terminal in Philadelphia, Pennsylvania,” according to a statement from Energy Transfer. According to the terms of the agreement, Crestwood common unitholders will receive 2.07 Energy Transfer common units for each Crestwood common unit. After the transaction closes in the fourth quarter of 2023, Crestwood unitholders will own about 6.5% of Energy Transfer’s units. Energy Transfer also anticipates at least $40 million in annual cost savings before the deal’s extra advantages.