KKR-led consortium to buy US energy company Samson for $7.2 bn
24 November 2011
A consortium led by private equity firm Kohlberg Kravis Roberts (KKR) yesterday agreed to acquire the Samson Investment Co, one of the largest privately-held oil and gas companies in the US, for about $7.2 billion.
The deal is the second-largest leveraged buyout by a private equity firm this year after Blackstone Group acquired nearly 600 shopping malls from Australia's Centro Properties for $9.4 billion.
New York-based KKR, which has completed over $400 billion of private equity transactions since inception and was a pioneer in the leveraged buyout industry, has teamed up with Japanese conglomerate Itochu Corporation, and two other private equity firms, Natural Gas Partners and Crestview Partners to bag one of the biggest deals in its 35-year history.
To close the deal, co-founders of KKR, Henry Kravis had to travel to his hometown of Tulsa, Oklahoma, accompanied by George Roberts to meet Stacy Schusterman, chief executive officer of Samson to convince her that the company's headquarters would remain in Tulsa.
Samson, owned by the Schusterman family, has a stake in more than 10,000 wells and operates some 4,000 of them, including the oil-producing properties in North Dakota's Bakken region and the Powder River in the northwest US. It has shale-gas fields in Haynesville in Texas and Louisiana, and Bossier in Louisiana.
Samson spends in excess of $1 billion in annual capital expenditure to manage its oil and gas operations, leading to a revenue mix of 70 per cent from gas drilling and 30 per cent from oil liquids.