Flywheel Energy Closes On Acquisition of Southwestern Energy Company’s Fayetteville Shale Business

OKLAHOMA CITY, Dec. 4, 2018 /PRNewswire/ — Flywheel Energy, LLC, and certain wholly-owned subsidiaries (“Flywheel” or the “Company”), an independent oil and natural gas company headquartered in Oklahoma City, Oklahoma and backed by the Kayne Private Energy Income Funds platform, announced that it has closed on its acquisition of Southwestern Energy Company’s (“SWN”) Fayetteville Shale Business for a purchase price of $1.865 billion (as adjusted for customary purchase price adjustments).

The acquired assets include 716 mmcf/d of net production from 4,033 producing wells across over 900,000 net acres and an integrated midstream gathering system with over 2,000 miles of gathering pipelines and more than 50 compressor stations, all located in central Arkansas.

“Flywheel Energy is pleased to announce the closing of our second acquisition since the Company’s inception in 2017.  I am proud of our team’s accomplishments and we are excited to join the remarkably talented team in the Fayetteville Shale,” commented Justin Cope, Chief Executive Officer of Flywheel. “We believe this is a great step forward as we work to deliver reliable, affordable and plentiful energy while generating attractive risk-adjusted returns for our investors.”

“We know that having a high-quality team which upholds the highest safety and environmental standards is critical to our company’s future success, and we are proud to join this team,” said Cope. “We look forward to being long-term, active members of the Arkansas community.”

Wells Fargo Bank, N.A, along with Citibank, N.A. provided an underwritten debt financing commitment to Flywheel. Wells Fargo Securities, LLC served as lead arranger and bookrunner and Citigroup Global Markets, BMO Capital Markets Corp., Capital One, National Association, Royal Bank of Canada and TD Securities (USA), LLC served as joint lead arrangers and bookrunners on the Company’s $1.425 billion credit facility. Wells Fargo Securities, LLC served as financial and technical advisor to Flywheel. In addition, Vinson & Elkins LLP provided legal counsel to Flywheel, Mobius Risk Group served as marketing and derivates advisor to Flywheel and Alvarez & Marsal North America, LLC performed transaction due diligence and integration services for Flywheel.

ABOUT FLYWHEEL ENERGY

Flywheel Energy began as Valorem Energy in early 2017 with backing from the Kayne Private Energy Income Fund. In 2017, Valorem acquired interests in the Williston Basin for $285 million, which the Flywheel organization continues to retain. In August 2018, the platform committed a second time to the management team with $700 million of equity in the form of the newly-formed Flywheel Energy. Flywheel Energy is a private exploration and production company formed to acquire and operate large, producing onshore U.S. oil and gas assets with an emphasis on the Rockies and Mid-Continent. With this acquisition, Flywheel entities will have made over $2.1 billion of acquisitions since 2017.

ABOUT KAYNE ANDERSON CAPITAL ADVISORS

Kayne Anderson Capital Advisors, L.P., founded in 1984, is a leading alternative investment management firm focused on niche investing in upstream oil and gas companies, energy and infrastructure, specialized real estate, growth equity and both private credit and diversified liquid credit. Kayne Anderson’s investment philosophy is to pursue niches, with an emphasis on cash flow, where our knowledge and sourcing advantages enable us to deliver above average, risk-adjusted investment returns. Kayne manages $29 billion in assets (as of 10/31/2018) for institutional investors, family offices, high net worth and retail clients and employs 350+ professionals in eight offices across the U.S.

The Kayne Private Energy Income Funds platform is part of Kayne Anderson’s successful energy private equity practice that has raised over $8 billion since 1998. The strategy was formed in late 2014 to take advantage of the market opportunity to acquire and develop large, long-life producing oil and gas assets in North America.

Kayne Anderson is headquartered in Los Angeles with offices in Houston, New York City, Chicago, Denver, Dallas, Atlanta, and Boca Raton. For more information, please visit www.kaynecapital.com

 

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SOURCE Flywheel Energy

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