American Energy - Permian Basin, LLC Announces Closing Of Permian Basin Acquisition And $1.6 Billion Senior Notes Offering

OKLAHOMA CITY, July 31, 2014 /PRNewswire/ -- American Energy – Permian Basin, LLC (AEPB), an affiliate of American Energy Partners, LP (AELP), announced today that it has closed on its acquisition of approximately 63,000 net acres of leasehold in the southern Permian Basin, primarily in Reagan, Irion and Crockett Counties, Texas and associated gathering assets from affiliates of Denver-based Enduring Resources II, LLC (Enduring) for $2.5 billion.  Concurrently, AEPB closed on its offering of $350 million of floating rate senior unsecured notes due 2019, $650 million of 7.125% senior unsecured notes due 2020 and $600 million of 7.375% senior unsecured notes due 2021, which priced on July 16, 2014.  A portion of the net proceeds from the senior notes offering was used to consummate the acquisition, while the remaining net proceeds will be used for general corporate purposes.

AEPB has also entered into a reserves-based revolving credit facility as borrower with, among others, Bank of America, N.A., as administrative agent and collateral agent, Goldman Sachs Bank USA as lender and syndication agent, Wells Fargo Bank, National Association, as technical agent and co-documentation agent and other lenders party thereto.  The revolving credit facility provides AEPB with a credit limit subject to a borrowing base, determined by reference to the value of AEPB's oil and gas properties.  The initial borrowing base under the revolving credit facility is $500 million, which will remain in effect until the first regularly scheduled borrowing base redetermination in October 2014.  AEPB intends to use the borrowings under the revolving credit facility to fund ongoing capital expenditures and working capital requirements and for general corporate purposes. 

AEPB has also raised approximately $1.145 billion in private equity capital, of which approximately 75% was provided by lead investor The Energy & Minerals Group who also holds a majority of the AEPB Board seats.  Additional equity capital was provided by First Reserve, AEPB's management team and others. The transactions completed today bring the total capital raised by AEPB to approximately $3.25 billion, including borrowings available under the revolving credit facility.

Goldman, Sachs & Co., Tudor, Pickering, Holt & Co. and Citi acted as financial advisors to AEPB on the acquisition. Sullivan & Cromwell LLP, Commercial Law Group, P.C. and Porter Hedges LLP acted as legal advisors to AEPB on the acquisition. Jefferies LLC acted as financial advisor to Enduring and Latham & Watkins LLP acted as legal advisor to Enduring on the acquisition.

Goldman, Sachs & Co. was the sole book-running manager for the notes offering. Sullivan & Cromwell LLP acted as legal advisor to AEPB in connection with the notes offering and Simpson Thacher & Bartlett LLP acted as legal advisor to the initial purchasers.

About American Energy – Permian Basin, LLC:
American Energy – Permian Basin, LLC is an independent oil and natural gas company affiliated with American Energy Partners, LP focused on the acquisition, development and production of unconventional oil and natural gas reserves in the Permian Basin in West Texas.

About American Energy Partners, LP:
American Energy Partners, LP was founded by Aubrey K. McClendon in April 2013 to capitalize on opportunities available in unconventional resource plays onshore in the U.S.  For additional information, please visit www.americanenergypartners.com.

About The Energy & Minerals Group:
EMG is the management company for a series of specialized private equity funds.  The Firm was founded by John Raymond (majority owner and CEO) and John Calvert in 2006.  EMG focuses on investing across various facets of the global natural resource industry including the upstream and midstream segments of the energy complex. EMG has approximately $15.4 billion of regulatory assets under management (RAUM) and approximately $6.8 billion in commitments have been allocated across the energy sector since inception.  For additional information, please visit www.emgtx.com.

About First Reserve:
First Reserve is the largest global private equity firm exclusively focused on energy.  With over 30 years of industry insight, investment expertise and operational excellence, the Firm has cultivated an enduring network of global relationships and raised more than $26 billion of aggregate capital since inception.  Its portfolio companies operate in approximately 50 countries and span the energy spectrum from upstream oil and gas to midstream and downstream, including resources, equipment and services and infrastructure.  For additional information, please visit www.firstreserve.com.

SOURCE American Energy Partners, LP