06:08 PM EDT, 10/01/2024 (MT Newswires) -- Summit Midstream ( SMC ) said Tuesday it agreed to acquire Tall Oak Midstream Operating and its subsidiaries from an affiliate of Tailwater Capital in a cash-and-stock deal.

The purchase of Tall Oak Midstream III, a major gas collection and refining network in the Arkoma Basin, strengthens Summit's expansion prospects and its ability to produce free cash flow, according to the company.

Summit said the acquisition will add 440 million cubic feet per day of processing capacity to its operations, more than 400 miles of pipelines, and 300,000 dedicated acres with significant undeveloped locations.

Summit will pay $155 million upfront cash for membership interest which will be financed through a credit facility, and about 7.5 million common shares of Summit and an equal number of common units from the partnership.

Additionally, Summit will pay $25 million in contingent consideration in cash over specified measurement periods through March 31, 2026.

The transaction is set to close in Q4 2024, subject to shareholder and regulatory approvals and customary closing conditions.

Price: 36.00, Change: +0.09, Percent Change: +0.25