Boston, MA 09/23/2014 (wallstreetpr) – According to reports, Magnum Hunter Resources Corp (NYSE:MHR) has entered into a definitive agreement with three different companies i.e. MSIP II Buffalo Holdings LLC and Eureka Hunter Holdings, LLC. An agreement has been signed by Magnum Hunter Services, LLC, which is a fully owned subsidiary of MHR. MSIP II Buffalo Holdings LLC is a fully owned affiliate of Morgan Stanley Infrastructure Inc, whereas Eureka Hunter Holdings, LLC is majority owned subsidiary of MHR, through which the company conducts various midstream operations. All three firms entered into a transaction agreement on September 15, 2014.
Insights of the transaction agreement:
The transaction agreement is closely related to a separate agreement signed by MSI in order to purchase all common equity interest and convertible preferred shares in Eureka Hunter, which is owned by Ridgeline Midstream Holdings, LLC. It is an affiliate of ArcLight Capital Partners, LLC. The transaction agreement contained an appended form of second restated and amended limited liability company agreement of Eureka Hunter. With the help of this agreement, it’s easy to enter among Eureka Hunter, MSI, Magnum Hunter Resources Corp (NYSE:MHR) and the other current company members of Eureka Hunter with limited liability. It will be executed immediately after the purchase of Ridgeline’s equity interests in Eureka Hunter by MSI. As per the information revealed by the company, it will be done in the starting of October. The transaction agreement will be effective immediate after the transaction of MSI and Eureka Hunter in early October.
As per the T&C of the transaction agreement, Magnum Hunter Resources Corp (NYSE:MHR) will sell an additional common equity interest in Eureka Hunter in a second closing of the transaction, which is expected to occur in January 2015. The total purchase price for such additional common equity shares will be approximately $65 million, which represents a part of Eureka Hunter’s total equity value of $1.0 billion.
