© 2019 Alinda Capital Partners

Alinda Acquires 49% interest in Maurepas Pipeline

August 20, 2018

Investment funds managed by Alinda Capital Partners have agreed to acquire a 49 percent interest in Maurepas Pipeline Pipeline, LLC for $350 million from SemGroup Corporation (NYSE:SEMG). The transaction will be structured as the sale of Class B interests. The transaction is expected to close by year-end 2018, and is subject to certain closing conditions.

Under the terms of the agreement, SemGroup has an option to reacquire the interest prior to the fifth anniversary of closing, subject to a 24-month non-call period. The call price is based on a predetermined fixed return on Alinda’s investment, including capital contributions.

“We are pleased with the opportunity to partner with Alinda on this high-value transaction and make a significant stride forward in achieving our leverage goals,” said SemGroup President and CEO Carlin Conner. “The valuation multiple provides SemGroup with an attractive cost of capital and the financial flexibility to pay down debt and de-lever our balance sheet while also reinvesting those funds in high-return areas surrounding our footprint. The favorable terms of the transaction provide the option to buy back Alinda’s interest in Maurepas, which is an extremely stable asset supported by long-term contracts with Gulf Coast refineries.”

Chris Beale, Alinda’s Managing Partner, added, “We are excited to partner with SemGroup on this strategically important pipeline system with stable long-term contracts. Maurepas is an excellent fit with our midstream infrastructure investment strategy.”

SemGroup will remain the majority owner and operator of the pipeline system, which consists of three separate transportation pipelines serving refineries in the Gulf Coast region of Louisiana.

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This transaction was completed on October 22, 2018.