Deal Description: On December 30, 2019, Summit Midstream Partners, LP (“SMLP”), announced that on December 24, 2019, it entered into agreements with an affiliate TPG Capital, L.P., a global alternative asset firm (“TPG”), for the purchase of up to $80 million of redeemable, preferred interests (the “Preferred Units”) in a newly created, unrestricted subsidiary of SMLP that indirectly owns SMLP’s 70% interest in Double E Pipeline, LLC (“Double E”), a joint venture with Exxon Mobil. In connection with the transaction, TPG will fund the next $80 million of SMLP’s capital calls associated with Double E. The investment by TPG will be made by TPG Energy Solutions, the firm’s energy-specific structured equity vehicle.
The Preferred Units are entitled to a quarterly distribution rate of 7% on the outstanding Preferred Units, which may be paid in-kind during the construction period for Double E. In addition, the transaction contains an accordion feature that allows TPG to purchase up to an additional $60 million of Preferred Units under the same terms and conditions. The Preferred Units may be redeemed at any time in whole or in part for cash over the next seven years, subject to a predetermined redemption price. SMLP will continue to lead the development, permitting, and construction of Double E, and will operate the pipeline upon commissioning.
Baker Botts L.L.P. represented SMLP in this transaction.
Baker Botts Lawyers/Office Involved:
Finance: Daniel L. Tristan (Partner, Houston)
For more information, please see SMLP’s news release by clicking here.
ABOUT BAKER BOTTS L.L.P.
Baker Botts is an international law firm of approximately 750 lawyers practicing throughout a network of 14 offices around the globe. Based on our experience and knowledge of our clients' industries, we are recognized as a leading firm in the energy and technology sectors. Since 1840, we have provided creative and effective legal solutions for our clients while demonstrating an unrelenting commitment to excellence. For more information, please visit bakerbotts.com.