“A group led by Apollo Global Management LLC agreed to acquire El Paso Corp. (EP)’s oil and natural gas exploration business for $7.15 billion in the second-biggest private equity takeover of an energy producer.
Apollo joins Riverstone Holdings LLC, Access Industries Inc. and other investors in the transaction, El Paso said in a statement today. Riverstone, based in New York, invests in the energy and power industries, and Access is the New York-based firm founded by Russian-born investor Len Blavatnik.
The deal is on par with KKR & Co. (KKR)’s $7.2 billion takeover of Samson Investment Co. last year. El Paso’s assets are attractive because of their acreage in the Niobrara field in Coloradoand the Eagle Ford and Wolfcamp fields in Texas, which produce more profitable oil and natural gas liquids such as propane and butane, said Raymond James & Associates’ Darren Horowitz.
“All of those areas are, I think, the right place at the right time,” said the Houston-based analyst, who rates Kinder Morgan an “outperform” and doesn’t own the stock….”
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