Kinder Morgan (KMI) and Brookfield Infrastructure Partners have signed an agreement to jointly acquire the 53% stake in Natural Gas Pipeline Company of America (NGPL) from the partner Myria Holdings for $242m.
Kinder Morgan will pay about $136m to increase its ownership interest from the existing 20% to 50%.
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Brookfield Infrastructure will pay about $106m and boost its ownership in the pipeline venture from 27% to 50%.
The transaction will value the KMI-operated NGPL at a total enterprise value of $3.4bn.
The interstate pipeline system NGPL serves Chicago and the Midwest and has about 9,200 miles of pipeline, over one million horsepower of compressor facilities in addition to 288 billion ft³ of working gas storage.
KMI CEO Steve Kean said: “We are extremely pleased to announce an agreement to acquire full ownership of NGPL in partnership with Brookfield.
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By GlobalData“This partnership ensures that NGPL is positioned to take full advantage of future opportunities to provide natural gas transportation and storage services to its current and future customers.”
The transaction is subject to customary closing conditions, including regulatory approval and is expected to close later in 2015.
Following the acquisition, KMI will continue to operate NGPL which brings gas from the Texas Permian Basin and Gulf of Mexico into the Chicago area and has two legs.
One leg goes to New Mexico and the other goes to the Gulf of Mexico.
KMI owns an interest in or operates 84,000 miles of pipelines and about 165 terminals and has an enterprise value of about $100bn.
Image: Kinder Morgan Building, Houston – 1001 Louisiana St, Houston, Texas. Photo: courtesy of WhisperToMe
