Targa Resources Corp. TRGP declared that it signed agreements to take over Southcross Energy Operating LLC and its subsidiaries in South Texas in a deal worth $200 million. This deal will help strengthen Targa’s natural gas gathering and processing footprint.
Per Targa, this transaction signifies a 4X adjusted EBITDA multiple and provides the added synergy potential to reduce the acquisition multiple over time. The deal also offers the potential to move a presently idle 200 million cubic feet per day plant through fee-based contracts and continued simplification through the acquisition of Southcross’ remaining T2 joint-venture interests.
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The deal, which is subject to conventional closing conditions, is anticipated to be closed by the second quarter of 2022.
Targa Resources is a premier energy infrastructure company. A leading provider of integrated midstream services in North America, this Houston, TX-based operator primarily derives its revenues from gathering, compressing, treating, processing and selling natural gas. TRGP also provides services associated with natural gas liquids, including those to liquefied petroleum gas exporters and crude oil.
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