Ironwood II Cashes in with Over $800 Million Deal
Deal News | Jan 07, 2025 | Encap Flatrock Midstream
EnCap Flatrock Midstream (EFM), a leading provider of growth capital in the North American midstream sector, announced the execution of two significant agreements. These involve the sale of Ironwood Midstream Energy Partners II, LLC and EFM's Plains Series A Preferred Units to Plains All American L.P. for over $800 million. The deal, set to close in Q1 2025 pending regulatory approvals, marks a significant monetization event for EFM and its investors. EFM Managing Partner Gregory C. King highlighted the value creation potential of such sales and reaffirmed EFM's commitment to capital stewardship and asset development. Ironwood II, an EFM-backed company since 2019, has grown into a leading crude oil gathering and transport system with a robust presence in the Eagle Ford shale region. The advisory teams for the transaction included RBC Capital Markets and Haynes Boone for Ironwood, with Piper Sandler and Vinson & Elkins advising Plains. EnCap Flatrock, with investment commitments exceeding $9 billion, continues to leverage its strategic partnerships for comprehensive midstream advancement.
Sectors
- Midstream Energy
- Private Equity
Geography
- United States – The deal centers around companies operating in the U.S., specifically focusing on the Eagle Ford shale region in South Texas.
- Texas – Both Ironwood Midstream and EnCap Flatrock Midstream are headquartered in Texas, highlighting the state's significance in the midstream energy industry.
Industry
- Midstream Energy – This sector involves the transportation, storage, and wholesale marketing of crude or refined petroleum products, which is precisely the business focus of Ironwood II and EnCap Flatrock Midstream.
- Private Equity – EnCap Flatrock Midstream represents private equity activities in acquiring and managing investments in midstream assets.
Financials
- 800 million – The combined cash proceeds from the sale of Ironwood II and Plains Series A Preferred Units to Plains All American.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| EnCap Flatrock Midstream | PE Firm / Seller | Company | A provider of growth capital to management teams in the midstream sector. |
| Ironwood Midstream Energy Partners II, LLC | Target Company | Company | A privately-held midstream company focused on crude oil and natural gas infrastructure. |
| Plains All American L.P. | Buyer | Company | A publicly traded master limited partnership listed on the NYSE engaged in midstream oil activities. |
| RBC Capital Markets | Financial Advisor to Ironwood Midstream | Company | Provided financial advisory services for the transaction. |
| Haynes Boone | Legal Advisor to Ironwood Midstream | Company | Provided legal advisory for Ironwood Midstream in the transaction. |
| Wilkie Farr & Gallagher | Legal Advisor to EnCap Flatrock Midstream | Company | Served as legal advisors to EFM. |
| Piper Sandler | Financial Advisor to Plains All American | Company | Provided financial advisory services for Plains. |
| Vinson & Elkins | Legal Advisor to Plains All American | Company | Provided legal advisory services for Plains. |