Niska Gas Storage Partners LLC and its managing member, Niska Gas Storage Management LLC, have entered into a definitive agreement to be acquired by Brookfield Infrastructure and its institutional partners.
Niska is a growth-oriented midstream natural gas services provider with operations focused on owning, operating, developing and acquiring midstream energy assets in the United States and Canada. Niska owns and operates three natural gas storage facilities, including the AECO Hub in Alberta, Canada; Wild Goose in California; and Salt Plains in Oklahoma. They also contract for natural gas storage capacity in the U.S. Mid-continent.
Under the terms of the acquisition agreement, Brookfield will acquire all of Niska`s outstanding common units for US$4.225 per common unit in cash and will acquire the managing member and the incentive distribution rights in Niska.
The transaction is valued at approximately US$911.9 million, including the assumption of debt. Based on the closing unit price on June 12, 2015, the US$4.225 per unit purchase price represents a premium of approximately 222% to the trading price for the common units. The closing of the transaction is expected to occur in the second half of 2016.
The Merger Agreement has been approved by Niska`s Board of Directors. In addition, the Conflicts Committee of the Niska Board of Directors has approved the Transaction. Affiliates of Riverstone Investment Group LLC ("Riverstone"), owning common units representing, in the aggregate, approximately 53% of the outstanding common units, have delivered a written consent approving the Transaction.
In connection with the entry into the Merger Agreement, Brookfield has committed to lend up to $50.0 million to Niska under a short term credit facility to be used for working capital purposes. Brookfield`s commitment is subject to certain conditions, including the completion of definitive documentation and other conditions under the Merger Agreement.
Evercore Partners, Inc. is acting as exclusive financial advisor to Niska and Riverstone and Vinson & Elkins LLP and Stikeman Elliot LLP are acting as legal advisors to Niska and Riverstone. Norton Rose Fulbright is acting as legal advisor to Brookfield. Greenhill & Co. is serving as exclusive financial advisor to the Conflicts Committee of the Niska Board of Directors and provided a fairness opinion on the Transaction, and Richards, Layton & Finger, P.A. is serving as legal counsel to the Conflicts Committee of the Niska Board of Directors.
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