Southcross Energy LLC and TexStar Midstream Services LP are merging in the latest energy transaction.
Dallas-based Southcross Energy, owns the general partner of Southcross Energy Partners LP (NYSE: SXE), which provides natural gas gathering, treating and transportation services. The company is backed by Boston-based middle market private equity firm Charlesbank Capital Partners.
TexStar Midstream, a portfolio company of energy investor EIG Global Energy Partners and Dallas private equity firm Tailwater Capital, provides natural gas liquids transportation and fractionation.
Simultaneously with closing of the deal, Southcross will acquire about one-third of TexStar’s midstream assets for about $450 million, consisting of $180 million in cash and shares of common stock.
After the deal closes, a newly formed company, Southcross Holdings LP will own the assets of both companies. The combined business will focus on oil and gas operations in the Eagle Ford shale play, and own four processing plants, three fractionation facilities and 3,700 miles of pipeline. Southcross will be owned by EIG Global Energy Partners, Charlesbank Capital Partners and Tailwater Capital.
Other recent oil and gas deals include the merger of four energy companies into Nine Energy Service, earlier in June, and Triangle Petroleum Corp.’s (NYSE: TPLM) deal for two oil and gas propertiesin the Williston Basin for $120 million in May. Before that, in March, Southcross Energy paid $40 million for natural gas pipelines in Texas.