Kinder Morgan, Inc. and Brookfield Infrastructure Partners L.P. (Brookfield Infrastructure) today jointly announced that they have agreed to sell a 25% minority interest in Natural Gas Pipeline Company of America LLC (NGPL) to a fund controlled by ArcLight Capital Partners, LLC (ArcLight) for $830 million. The proceeds will be shared equally between KMI and Brookfield Infrastructure. The value of the minority interest implies an enterprise value of approximately $5.2 billion for NGPL, which is approximately 11.2 times 2020 EBITDA. Upon closing, KMI and Brookfield Infrastructure will each hold a 37.5% interest in NGPL, and KMI will continue to operate the pipeline.
“Kinder Morgan and Brookfield Infrastructure are pleased to welcome ArcLight into the NGPL joint venture,” said Kinder Morgan Natural Gas Pipelines President Tom Martin. “We believe this investment shows the value of natural gas infrastructure both today and in the decades to come.”
For this transaction, NGPL is served by RBC Capital Markets as the exclusive financial adviser and King and Spalding as the legal advisor. Barclays served as the exclusive financial advisor to ArcLight and has provided a committed debt financing to ArcLight to support the transaction. Latham & Watkins LLP served as legal advisor to ArcLight. The transaction is expected to close in the first quarter of 2021.