A team of attorneys with the Houston office of Sidley Austin represented Stonepeak Infrastructure Partners in closing energy development joint venture deals worth $1.1 billion with Targa Resources , a Houston-based company represented by Vinson & Elkins.
According an agreement reached on Feb. 6, the development joint ventures will own Targa’s 25 percent interest in Gulf Coast Express Pipeline, a 20 percent interest in the Grand Prix Pipeline and a 100 percent interest in Targa’s next natural gas processing project. Targa will control the management and day-to-day construction of the Grand Prix Pipeline.
The development joint ventures currently have approximately $220 million of assets. Stonepeak committed an aggregate of approximately $960 million of capital, including an initial contribution of approximately $190 million that will be distributed to Targa to reimburse the company for capital spent to date. Targa committed to fund approximately $150 million related to its share of the joint venture’s future capital costs.
The deals will significantly reduce Targa’s equity funding needs for 2018 and 2019 and proceeds from Stonepeak’s initial contribution will be used to reduce Targa’s current debt.
The Sidley Austin team representing Stonepeak was led by energy partner Cliff Vrielink of Houston. The firm’s team and also included energy partner Jon Daly, private equity associate Chris Folmsbee, tax counsel Zack Pullin, as well as merger and acquisition associates Alex Tanton, K. Nicole Lee and Sabra Thomas, all of Houston.
The V&E team representing Targa was led by partner Chris Collins of Houston. The firm’s team also included partner Darin Schultz, senior associate Benji Barron and associate Brittany Smith all of Houston. Also advising were partner Jim Meyer and associate Brian Russell of Dallas and partner Neil Imus of Washington D.C.