Natural gas company Eagle Rock Energy Partners, L.P. (EROC) Monday said it has received a non-binding proposal from privately held Black Stone Minerals Company, L.P. and certain of its co-investors to acquire Eagle Rock's Minerals Business for $157.5 million. Eagle Rock shares are currently trading up nearly 7% on the Nasdaq.
The proposal was made by Black Stone Minerals and certain co-investors including the LeFrak Organization, collectively called BSMC, to the Board of Eagle Rock on October 16.
In addition to the acquisition, BSMC wants to provide an equity investment commitment to support a proposed public offering by Eagle Rock of common units at $3.40 per unit and to grant Eagle Rock options to reacquire from Black Stone up to 2.8 million common units issued to Black Stone pursuant to its equity investment commitment and up to 15% of the Minerals Business sold to Black Stone.
There are no fees associated with Black Stone's proposal and it is not contingent upon obtaining financing.
Eagle Rock stated that the board and conflicts committee of the general partner of Eagle Rock are reviewing the proposal.
Early August, Eagle Rock had said it will continue to investigate potential asset sales to further reduce leverage levels, which could include small, discrete midstream assets or all or certain portions of its upstream or minerals businesses.
EROC is currently trading at $4.94 per share, up 6.39%, on the Nasdaq.
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