WASHINGTON (dpa-AFX) - LINN Energy, LLC (LINE) and LinnCo, LLC (LNCO) announced that LINN Energy inked a definitive purchase deal to buy oil and natural gas properties located in the Permian Basin for a contract price of $525 million. The acquisition, which would close in the fourth quarter of 2013, would be financed mainly with proceeds from a committed term loan to be entered into at closing.
'This transaction increases the firm's exposure to oil and adds over 300 proved low-risk infill drilling opportunities as well as future waterflood potential,' said Mark Ellis, Chairman, President and Chief Executive Officer. He continued, 'We expect this transaction will be immediately accretive to cash available for distribution.'
LINN would finance this purchase with proceeds from a committed $500 million senior secured term loan with certain participants in its lender group and borrowings under its revolving credit facility. The term loan is likely to have a maturity of April 2018, consistent with the maturity of the credit facility, incur interest at a rate of LIBOR plus 2.5 percent and be funded at closing, which may occur in the fourth quarter of 2013.
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