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Memorial Production Partners LP Announces Closing Of Acquisition Of Oil And Gas Properties, Distribution Increase, Borrowing Base Increase, Updated Commodity Hedge Positions And Updated 2013 And 2014 Guidance
HOUSTON, Oct. 1, 2013 (GLOBE NEWSWIRE) -- Memorial Production Partners LP (Nasdaq:MEMP) announced today that it has closed its previously announced acquisition of oil and natural gas properties in the Permian Basin, East Texas, and the Rockies, from its sponsor, Memorial Resource Development LLC, and affiliates of Natural Gas Partners for an aggregate purchase price of approximately $603 million, subject to customary post-closing adjustments. The effective date for this transaction is July 1, 2013.
In conjunction with the closing of the acquisition, the Board of Directors of MEMP's general partner approved an increase in the distribution rate to $0.55 per unit for the third quarter of 2013, representing an annualized amount of $2.20 per unit. This distribution represents an 11.1% increase over the quarterly distribution of $0.4950 per unit ($1.98 per unit on an annualized basis) related to the third quarter of 2012 and a year to date increase of approximately 8.4% over the quarterly distribution of $0.5075 per unit ($2.03 per unit on an annualized basis) paid in the first quarter of 2013.
"This acquisition demonstrates our commitment to create value for our unitholders through accretive acquisitions, and we are pleased to announce our fifth distribution increase since MEMP's IPO, which represents a 15.8% increase over the annualized minimum quarterly distribution of $1.90 per unit," said John A. Weinzierl, Chairman, President and Chief Executive Officer of the general partner of MEMP. "In connection with the closing of our acquisition and a review of our operational performance, we have updated our guidance for 2013 and announced 2014 guidance. Going forward, we are excited about MEMP's geographic footprint in five outstanding MLP appropriate oil and gas producing regions and believe we are well-positioned to continue on the growth trend we have been on since our IPO."
In conjunction with the closing of the acquisition, MEMP amended its multi-year credit facility from $1.0 billion to $2.0 billion, increased the number of lenders from 17 to 21 and increased its borrowing base from $480 million to $920 million. As of October 1, 2013, including the total borrowings to pay for the acquisition, MEMP had approximately $675 million in borrowings outstanding under its credit facility and $245 million of borrowing availability, which management believes will provide the financial flexibility to continue pursuing MEMP's acquisition growth strategy.