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Tue 24 Jul 2018 10:36 AM

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Kuwait Investment Authority's UK unit to buy North Sea midstream firm for $1.7bn

North Stream Midstream Partners has interests in and operates four natural gas transportation and processing assets in the North Sea

Kuwait Investment Authority's UK unit to buy North Sea midstream firm for $1.7bn
NSMP – which was founded in 2012 – has interests in and operates four large scale natural gas transportation and processing assets in and around the North Sea, including a 67 percent oprated interest in the Shetland Island Regional Gas Export System pipeline and a 100 percent operated interest in the Frigg UK pipeline.

Wren House, the UK-based arm of the Kuwait Investment Authority has agreed to buy North Stream Midstream Partners (NSMP) from energy-focused private equity firm ArcLight Capital Partners, it was announced on Tuesday.

In a statement, Wren House said that it agreed to acquire ArcLight’s entire stake in the company. Although the company has provided no details of the transaction, several unnamed sources told Reuters that the deal is worth approximately $1.7 billion, winning out bidders including JP Morgan and Blackstone.

The Wren House bid was reportedly lower than others, but offered better overall terms, Reuters reported.

NSMP – which was founded in 2012 – has interests in and operates four large scale natural gas transportation and processing assets in and around the North Sea, including a 67 percent oprated interest in the Shetland Island Regional Gas Export System pipeline and a 100 percent operated interest in the Frigg UK pipeline.

The Wren House statement noted that the company was “attracted to NSMP’s core infrastructure characteristics with a strong revenue stream underpinned by long-term contracts, diversification across various North Sea gas basins within NSMP’s catchment areas, including Norway, and the potential for future growth.”

Hakim Drissi Kaitouni, the managing director of Wren House, said that “NSMP’s catchment areas, in particular the West of Shetland basin, represent one of the most promising areas in terms of exploration and future developments.”

The transaction is expected to complete in 2018, following the receipt of merger clearance.

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