Summit Midstream acquires Tall Oak Midstream for $450 MM
Summit Midstream Corp. will acquire Tall Oak Midstream III from Tailwater Capital for approximately $450 MM, the companies announced.
Tall Oak operates a large gas gathering and processing system in the Arkoma Basin, featuring two natural gas processing plants with a total capacity of 220 MMft3d and 411 mi of gas gathering lines. The transaction is expected to close in Q4 2024, pending regulatory and shareholder approvals.
The deal includes $155 MM in cash and 7.5 million shares of Summit's Class B common stock and common units, representing about 40% ownership in the combined company. Additionally, the deal includes up to $25 MM in contingent cash payments through March 2026.
"Partnering with Summit presents a unique opportunity to support the company’s long-term growth," said Jason Downie, Co-Founder of Tailwater Capital. "Tall Oak’s assets complement Summit's existing gas portfolio, and we believe it will drive even more value for shareholders."
Ryan Lewellyn, CEO of Tall Oak Midstream, praised his team for delivering reliable service and expressed confidence in Summit's ability to continue the company's progress. Tailwater Capital will appoint four directors to Summit’s board following the deal’s closure.
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