Crestwood Equity Partners To Sell Tres Palacios Gas Storage To Newly Formed JV

(RTTNews) - Crestwood Equity Partners LP (CEQP) and Crestwood Midstream Partners LP (CMLP) announced that Crestwood Equity has entered into definitive agreements to sell 100% of the membership interest in Tres Palacios Gas Storage LLC to a newly formed joint venture between Crestwood Midstream and an affiliate of Brookfield Infrastructure Group for total cash consideration of $130 million.

Crestwood Midstream will own 50.01% of Tres Palacios Holdings LLC and will be the operator of Tres Palacios and its assets. The transaction is expected to close in early December 2014.

It is noted that Crestwood Midstream expects to initially fund its $65 million portion of the purchase price utilizing its $1.0 billion revolving credit facility. Crestwood Midstream has about $125 million of remaining committed preferred equity available to be issued under its June 2014 equity agreement and it intends to utilize a portion of this remaining commitment to pay down revolver borrowings in connection with this transaction.

Crestwood Equity will use the net sale proceeds to repay $130 million of loans outstanding under its revolving credit facility and reduce its loan commitments thereunder by an equal amount, which will result in Crestwood Equity having an aggregate borrowing capacity of $495 million under its credit agreement.