Oct 24 (Reuters) - American Midstream Partners LP said it would buy JP Energy Partners LP in an all-stock deal, creating a $2 billion midstream master limited partnership.
JP Energy’s public unitholders will receive $8.63 per common unit, a premium of 14.5 percent to the stock’s Friday close.
The combined company, which will be headquartered in Houston, will operate in the oil-rich North American basins including the Permian, Eagle Ford and Bakken, the companies said on Monday.
Private equity firm ArcLight Capital Partners LLC, which holds stakes in both companies, will combine the general partners of the companies.
ArcLight owns 15.6 percent of American Midstream and 19.8 percent of JP Energy as of June 30, according to Thomson Reuters data.
American Midstream Chief Executive Lynn Bourdon will lead the combined company.
The combined company will own and operate more than 3,100 miles of gathering and transportation pipelines.
Bank of America Merrill Lynch is the financial adviser to American Midstream and Locke Lord LLP is its legal counsel.
BMO Capital Markets is the financial adviser to JP Energy, while Latham & Watkins the legal counsel. (Reporting by Anet Josline Pinto and Vishaka George in Bengaluru; Editing by Shounak Dasgupta and Sriraj Kalluvila)