Market Overview

UPDATE: Targa Resources Partners LP, Targa Resources Corp. Announce Purchase of Atlas Pipeline Partners LP, Atlas Energy LP for $7.7B


Targa Resources Partners LP
(NYSE: NGLS) ("Targa Resources Partners", "TRP" or the "Partnership") and Targa
Resources Corp. (NYSE: TRGP) ("Targa Resources", "TRC" or the "Company")
announced today they have entered into agreements to acquire Atlas Pipeline
Partners, L.P. (NYSE: APL) ("Atlas Pipeline Partners" or "APL") and Atlas
Energy, L.P. (NYSE: ATLS) ("Atlas Energy" or "ATLS"). Targa Resources will
acquire ATLS following the spin-off announced today by ATLS of its
non-midstream assets. The acquisitions are contingent on one another, and the
transactions will close concurrently.

Targa Resources Partners will acquire Atlas Pipeline Partners for total
consideration of $5.8 billion, including $1.8 billion of debt as of September
30, 2014. Each APL common unitholder will be entitled to receive 0.5846 units
of Targa Resources Partners and a one-time cash payment of $1.26 per APL
common unit for total consideration of $38.66 per APL common unit, based on
the closing price of the Partnership's units on October 10, 2014.  The
exchange ratio was negotiated as a 15% premium for APL common unitholders
based on the volume weighted average prices of APL and TRP units during the 15
trading days ending October 3, 2014.  The Partnership will also redeem APL's
Class E Preferred Units for an aggregate amount of $126.5 million in cash. 

The Partnership expects to finance the cash portion of the transaction with
borrowings under its revolving credit facility. In connection with the
acquisitions, Targa Resources has agreed to reduce its incentive distribution
rights for the four years following closing by fixed amounts of $37.5 million,
$25.0 million, $10.0 million and $5.0 million, respectively. These annual
amounts will be applied in equal quarterly installments for each successive
four quarter period following closing. Based on the Partnership's units
outstanding as of September 30, 2014, current TRP unitholders will own
approximately 66% of the pro forma combined partnership and current APL common
unitholders will own approximately 34%. 

Atlas Energy, L.P. Acquisition 

Prior to Targa Resources' acquisition of Atlas Energy, ATLS will spin-off its
non-midstream assets. After giving effect to the spin-off, ATLS's assets will
solely comprise its general partner and incentive distribution rights
interests in APL and 5.8 million APL common units. Immediately following the
spin-off and subject to the concurrent closing of the Partnership's
acquisition of APL, Targa Resources will acquire Atlas Energy for total
consideration of $1.869 billion, including 10.35 million TRC shares valued at
$1.259 billion based on the closing price of TRC's common stock on October 10,
2014 and $610 million in cash.  Targa Resources has arranged committed
financing of $1.1 billion to replace its existing revolving credit facility
and to fund the cash components of the transaction, including cash merger
consideration and $149 million related to change of control payments. Based on
shares of TRC and units of ATLS outstanding as of September 30, 2014, current
Targa Resources shareholders will own approximately 80% of the pro forma
shares outstanding and current ATLS unitholders will own approximately 20%. 

Management Commentary  

"Both the Targa and Atlas management teams and our boards view this integrated
transaction as a highly compelling strategic opportunity to combine two
outstanding midstream businesses and create value for all shareholders and
unitholders. We believe the combination provides our customers an enhanced
midstream service offering, and presents our investors with an enterprise that
has increased scale, diversity and growth," said Joe Bob Perkins, Chief
Executive Officer of the Company and of the general partner of the
Partnership. "The acquisitions will significantly and immediately increase our
scale and geographic diversity, accelerating the growth of our premier North
American midstream platform. APL's footprint solidifies the Partnership's
position as a leader in the Permian Basin, while adding top-tier assets in the
Midcontinent and South Texas regions. Importantly, the combination of APL's
NGL production with Targa Resources Partners' leading NGL downstream assets
will allow the pro forma partnership to generate additional revenue along the
NGL value chain, create additional attractive growth capital expenditure
projects and accelerate current growth capital expenditure projects. We are
excited about this transaction and look forward to welcoming the employees of
Atlas to the Targa team." 

Strategic Rationale 

The combination of Targa Resources Partners and Atlas Pipeline Partners
creates a premier midstream franchise with increased scale, geographic
diversity and best in class capabilities in key producing basins in the U.S.,
and creates one of the largest diversified MLPs on an enterprise value basis.

* Attractive positions in active basins – the acquisitions add the
Woodford/SCOOP, Mississippi Lime and Eagle Ford and additional Permian
assets to the Partnership's existing Permian, Bakken, Barnett, and
Louisiana Gulf Coast operations
* Combined position across the Permian Basin enhances service capabilities
in one of the most active producing basins in North America, with a
combined 1,439 MMcf/d of processing capacity and 10,250 miles of pipelines
* Strong growth outlook with announced organic growth capital expenditures
of $1.2 billion for 2014 and over $1.2 billion in 2015
* Growing NGL production from gathering and processing business supports
Targa's leading NGL fractionation and export position (Mont Belvieu /
Galena Park / Lake Charles)
* Enhances credit profile and results in an estimated 60% pro forma
fee-based margin
* Underlying growth in the business drives incrementally higher distribution
and dividend growth immediately and over the longer term

2015 Guidance Update – Pro Forma for the Transaction 

For the Partnership, management expects to recommend a distribution increase
of $0.04 per limited partner unit at the first Board of Directors distribution
declaration meeting after the transaction closes; which is expected to be in
the first quarter of 2015. Assuming a first quarter close, the Partnership
estimates full year 2015 pro forma distribution growth over full year 2014 of
11% – 13%, and expects distribution coverage to be at or above the
Partnership's stated target range of 1.1x – 1.2x. In conjunction with the
Partnership recommendation, management expects to recommend a dividend
increase of $0.10 per share for Targa Resources following the closings of the
transactions. Assuming a first quarter close and 11 – 13% distribution growth
at the Partnership, the Company estimates full year 2015 pro forma dividend
growth over full year 2014 of approximately 35%. The Company's estimated 2015
effective cash tax rate pro forma for the transaction is expected to be 10% -
15% compared to 33% on a standalone basis. 

Conditions to Closing

The Boards of Directors of the Partnership, the Company, ATLS and APL have
each approved the respective merger agreements. Subject to the completion of
the spin-off and customary approvals and conditions, including the expiration
or termination of all waiting periods under the Hart-Scott-Rodino Antitrust
Improvements Act, the acquisitions are expected to close in the first quarter
of 2015. The APL acquisition is subject to the approval of the holders of a
majority of the limited partner interests in APL. The ATLS acquisition is
subject to the approval of the holders of the limited partner interests in
ATLS and the holders of the shares of common stock of the Company.  The
respective boards of APL, ATLS and the Company have voted to recommend the
transaction to their unitholders and shareholders.   


Evercore Partners acted as financial advisor to Targa Resources Partners and
the special committee of the Targa Resources Partners' Board of Directors.
Richards, Layton & Finger served as legal counsel to the special committee of
the Board of Directors of the general partner of Targa Resources Partners.
Wells Fargo Securities, LLC acted as financial advisor to Targa Resources
Corp. and Vinson & Elkins LLP acted as legal counsel for the Partnership and
the Company. BofA Merrill Lynch is providing committed financing to Targa
Resources for the transaction. 

Conference Call

Targa Resources Partners and Targa Resources Corp. will host a joint
conference call for investors and analysts on Monday, October 13, 2014, at
10:00 a.m. Eastern Time to discuss the transactions. The conference call can
be accessed via Webcast through the Events and Presentations section of the
Partnership's website at, by going directly to or by dialing
877-881-2598.The pass code for the dial-in is 20342180. Please dial in ten
minutes prior to the scheduled start time. A replay will be available
approximately two hours following the completion of the conference call
through the Investors section of the Partnership's website. Prepared remarks
by Chief Executive Officer Joe Bob Perkins will be followed by a question and
answer session. Prior to the conference call, an updated investor presentation
will be available in the Events and Presentations section of both the
Partnership's and Company's websites.

Additional Information and Where to Find It

In connection with the proposed transaction, the Company will file with the
U.S. Securities and Exchange Commission (the "SEC") a registration statement
on Form S-4 that will include a joint proxy statement of ATLS and the Company
and a prospectus of the Company (the "Company joint proxy
statement/prospectus"). In connection with the proposed transaction, the
Company plans to mail the definitive Company joint proxy statement/prospectus
to its shareholders, and ATLS plans to mail the definitive Company joint proxy
statement/prospectus to its unitholders. 

Also in connection with the proposed transaction, the Partnership will file
with the SEC a registration statement on Form S-4 that will include a proxy
statement of APL and a prospectus of the Partnership (the "Partnership proxy
statement/prospectus"). In connection with the proposed transaction, APL plans
to mail the definitive Partnership proxy statement/prospectus to its


This communication does not constitute an offer to sell or the solicitation of
an offer to buy any securities or a solicitation of any vote or approval.

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