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QEP Sold Its Midstream Business for $2.5 bln to Tesoro

Source: www.gulfoilandgas.com 10/19/2014, Location: North America

QEP Resources, Inc. announced that its wholly owned subsidiary, QEP Field Services Company (“Field Services”), has entered into a definitive agreement to sell its midstream business, including the Company's ownership interest in QEP Midstream Partners, LP, to Tesoro Logistics LP in an all cash transaction valued at $2.5 billion, including $230 million to refinance debt at QEPM. QEP will retain ownership of Field Services’ Haynesville Gathering System.

The decision to sell the midstream business is a result of the Company’s ongoing review of strategic alternatives to maximize shareholder value. After careful consideration of various potential transaction alternatives, QEP’s Board of Directors, in consultation with its financial advisors, unanimously determined that the outright sale of the midstream business for cash is the best course to achieve the highest value for QEP shareholders.

“This transaction allows us to maximize shareholder value by deploying proceeds from the sale through multiple avenues, including returning capital to shareholders, reducing debt, and improving our competitive position through increased capital investment in our premier E&P assets,” commented Chuck Stanley, Chairman, President and CEO of QEP Resources.

“Post-closing, QEP will emerge as a more competitive and financially strong independent E&P company with assets in two of North America’s most prolific crude oil provinces, the Williston and Permian Basins, and low-cost, high quality natural gas properties in the Rocky Mountains and in northwest Louisiana. The sale of our midstream business is a significant milestone in the strategic repositioning of our company, as we believe QEP will be better positioned to deliver continued growth in production and Adjusted EBITDA in 2015 and beyond.

“We also expect this transaction will provide expanded opportunities for our talented midstream employees, to whom I want to express my sincere appreciation for their outstanding work and extraordinary dedication to building QEP’s midstream business over the past two decades.” The transaction is subject to customary closing conditions and regulatory approvals, and is expected to close before year-end 2014. Deutsche Bank Securities Inc. and Goldman, Sachs & Co. are acting as financial advisors to QEP and Latham & Watkins LLP and Wachtell, Lipton, Rosen and Katz are serving as legal advisors.



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Related Categories: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Industrial Development  Insurance  Investment  Mergers and Acquisitions  Risk Management 

Related Articles: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Insurance  Investment  Mergers and Acquisitions  Risk Management 


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