El Paso Pipeline Partners announced today that it has agreed to acquire the remaining 14-percent interest in Colorado Interstate Gas Company (CIG) and all of Cheyenne Plains Investment Company, which owns Cheyenne Plains Gas Pipeline Company, from El Paso Corporation for $635 million and the assumption of approximately $242 million of proportional debt.
The transaction, which is expected to close contemporaneously with Kinder Morgan, Inc.’s acquisition of El Paso Corporation, will be immediately accretive to distributable cash flow and is being funded with approximately $571 million of cash from borrowings under EPB’s revolving credit facility and $64 million of equity from the issuance of common units to El Paso Corporation. El Paso Corporation will make an approximate $1 million general partner capital contribution to maintain its 2 percent general partner interest in El Paso Pipeline Partners, L.P.
The terms of the transaction were unanimously approved by the Board of Directors of the general partner, El Paso Pipeline GP Company, L.L.C., based in part on the unanimous approval and recommendation of the Board’s conflicts committee, which is comprised entirely of independent directors. The conflicts committee engaged Tudor, Pickering, Holt & Co. to act as its independent financial advisor and to render a fairness opinion.
LNG World News Staff, May 18, 2012