Simpson Thacher is representing KKR in connection with its proposed acquisition of Discovery Midstream from TPG Growth for approximately $1.2 billion. The company is being acquired through a newly formed joint venture with Williams (NYSE: WMB) and is being funded primarily through KKR’s energy and infrastructure funds. Williams’ initial economic contribution and ownership will be 40% of the purchase price, while KKR’s initial economic contribution and ownership will be 60% of the purchase price. Williams will be the operator of Discovery and will hold a majority of governance voting rights. Williams has committed to fund additional capital as required to bring its economic ownership to 50/50.

Founded in 2015 and based in Dallas, Texas, Discovery operates in the southern portion of Colorado’s Denver-Julesburg Basin. The company’s infrastructure and related facilities are strategically located across more than 250,000 dedicated acres primarily in Weld and Adams counties. The Discovery system includes both natural gas and crude oil gathering pipelines, cryogenic gas processing, liquids handling and crude oil storage. The Discovery assets include a 60 million cubic feet per day (MMcf/d) gas processing plant with an additional 200 MMcf/d plant that is fully permitted and under construction. It is expected to be in service by the end of 2018.

The Simpson Thacher team includes Breen Haire and Jacqui Bogucki (M&A); Nancy Mehlman, Joseph Tootle and Nicole Humphrey (Tax); Krista McManus and Dennis Loiacono (Real Estate); David Rubinsky and Alisa Tschorke (ECEB); Marcela Robledo (IP); Michael Isby (Environmental); and Peter Guryan and Kelly Karapetyan (Antitrust).

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