Kinetik Holdings Inc. (NYSE: KNTK) has announced the sale of its 27.5% equity interest in Epic Crude Holdings, LP to a subsidiary of Plains All American Pipeline, L.P. and Plains GP Holdings for approximately $500 million in net upfront cash. Additionally, there is a contingent cash payment of $96 million due if a capacity expansion of Epic Crude is formally sanctioned, bringing the total potential value to $596 million.
This transaction implies an upfront valuation for 100% of Epic Crude at $2.85 billion and $350 million for the contingent consideration. Jamie Welch, President and CEO of Kinetik, emphasized that the sale represents an opportunity to maximize long-term shareholder value by recycling proceeds from non-core asset sales to attractive growth projects and potential acceleration of shareholder returns.
The cash proceeds from the sale will be used for general corporate purposes. The transaction is expected to close by early 2026, subject to customary closing conditions, including clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
Vinson & Elkins LLP served as legal counsel to Kinetik in this transaction.
Kinetik Holdings Inc. is a fully integrated, pure-play, Permian-to-Gulf Coast midstream C-corporation operating in the Delaware Basin, with headquarters in Houston and Midland, Texas. The company provides comprehensive gathering, transportation, compression, processing, and treating services for companies that produce natural gas, natural gas liquids, crude oil, and water. As a result of these announcements, the company's shares have moved -1.73% on the market, and are now trading at a price of $41.95. For the full picture, make sure to review Kinetik's 8-K report.
