Exterran Holdings, Inc. (EXH) and Exterran Partners, L.P. (EXLP) announced that Exterran Partners will acquire assets from Exterran Holdings for consideration valued at $174 million including customer contracts relating to the operation of approximately 259,000 horsepower of compressor units.
The acquisition will include Exterran Holdings' contracts serving 50 customers together with approximately 370 compressor units used to provide compression services under those contracts, representing approximately 253,000 horsepower and approximately 8 percent of the combined U.S. contract operations business of Exterran Holdings and Exterran Partners.
In addition, the acquisition will include contracts covering approximately 6,000 horsepower owned by Exterran Partners which are currently being leased to Exterran Holdings and approximately 200 compressor units comprising approximately 100,000 horsepower currently being leased from Exterran Holdings to Exterran Partners.
The consideration to be paid to Exterran Holdings' affiliates will consist entirely of Exterran Partners' equity, comprised of approximately 7.1 million common units and approximately 145,000 general partner units.
The transaction is subject to regulatory approval and other closing conditions and is expected to close in March or April 2013.
In connection with and upon the closing of the transaction, the omnibus agreement between Exterran Partners and Exterran Holdings will be amended to, among other things, (i) increase the cap on selling, general and administrative costs from $10.5 million per quarter to $12.5 million per quarter, for the remainder of 2013, and to $15.0 million per quarter on January 1, 2014 and extending through the remainder of 2014, and (ii) increase the cap on operating costs from $21.75 per horsepower per quarter to $22.50 per horsepower per quarter, beginning on January 1, 2014, and extending through the remainder of 2014. These caps will now terminate on December 31, 2014, unless otherwise extended.
The transaction was approved by the conflicts committee of the board of directors of Exterran Partners' managing general partner.
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