Rose Rock Midstream Completes Acquisition of Additional Interest in White
Cliffs Pipeline From SemGroup Corporation
Acquisition Will Provide Immediate Accretion
TULSA, Okla., Dec. 16, 2013 (GLOBE NEWSWIRE) -- Rose Rock Midstream, L.P.
(NYSE:RRMS) and SemGroup^® Corporation (NYSE:SEMG) announced today that Rose
Rock has acquired from SemGroup an additional one-third interest in SemCrude
Pipeline, L.L.C., which owns a 51 percent interest in White Cliffs Pipeline
L.L.C. for $275 million. Rose Rock now owns a 67 percent interest in SemCrude
Pipeline and indirectly owns a 34 percent interest in White Cliffs Pipeline.
White Cliffs Pipeline is a 527-mile common carrier, crude oil pipeline system
that originates in Colorado and terminates in Cushing, Oklahoma. It has a
current capacity of 76,000 barrels per day and is in the process of an
expansion project which will increase total capacity to 150,000 barrels per
day. Rose Rock will be responsible for funding its portion of the expansion.
This project is expected to be completed mid-2014.
The acquisition will be immediately accretive to Rose Rock's distributable
cash flow on a per unit basis and was funded with approximately:
*$173.1 million of cash borrowings under Rose Rock's revolving credit
*$54.5 million of equity from the issuance of 1.5 million common units to
*$45.4 million of equity from the issuance of 1.25 million Class A units to
SemGroup. The Class A units will not receive any distributions, but are
convertible into common units on a one-for-one basis once White Cliffs
Pipeline achieves an average monthly volume of 125,000 barrels per day.
SemGroup gains increased distributions from Rose Rock for the limited partner
common units it received as consideration for the transaction. The increased
distributions from Rose Rock will support SemGroup's dividend growth strategy.
SemGroup now owns a 51.6 percent limited partner interest and the two percent
general partner interest of Rose Rock.
In connection with the transaction, Rose Rock exercised the accordion on its
revolving credit agreement which increased the total borrowing capacity from
$385 million to $585 million.
The terms of the acquisition were approved by the Conflicts Committee of the
Board of Directors of Rose Rock's general partner. The Conflicts Committee
engaged Evercore Partners to act as its independent financial advisor and to
render a fairness opinion, and Akin Gump Strauss Hauer & Feld, LLP to act as
its legal advisor. LCT Capital, LLC acted as financial advisor to SemGroup on
About Rose Rock Midstream
Rose Rock Midstream®, L.P. (NYSE:RRMS) is a growth-oriented Delaware limited
partnership formed by SemGroup® Corporation (NYSE:SEMG) to own, operate,
develop and acquire a diversified portfolio of midstream energy assets.
Headquartered in Tulsa, OK, Rose Rock Midstream provides crude oil gathering,
transportation, storage and marketing services with the majority of its assets
strategically located in or connected to the Cushing, Oklahoma crude oil
Based in Tulsa, OK, SemGroup® Corporation (NYSE:SEMG) is a publicly traded
midstream service company providing the energy industry the means to move
products from the wellhead to the wholesale marketplace. SemGroup provides
diversified services for end-users and consumers of crude oil, natural gas,
natural gas liquids, refined products and asphalt. Services include
purchasing, selling, processing, transporting, terminalling and storing
Rose Rock and SemGroup use their Investor Relations websites and social media
outlets as channels of distribution of material company information. Such
information is routinely posted and accessible on both Investor Relations
websites at ir.rrmidstream.comand ir.semgroupcorp.com or the Twitter and
LinkedIn accounts below.
CONTACT: Investor Relations:
Rose Rock Midstream logo
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