American Midstream Partners LP and JP Energy Partners LP have executed a merger agreement to create a combined midstream platform. American Midstream will acquire 100 percent of JP Energy in a unit-for-unit merger anticipated to have minimal if any tax recognition for unitholders. Upon closing, the combined entity is expected to generate pro-forma adjusted EBITDA of approximately $185 million, assuming 2016 midpoint guidance from each company and including run-rate synergies of approximately $10 million.
The merger will create a diversified midstream business operating in leading North American basins, including the Permian, Gulf of Mexico, Eagle Ford and Bakken. The combined partnership will have an estimated enterprise value of $2 billion.