Acquisitions (tables)

12 Months Ended

Dec. 31, 2014

The following table presents the acquisitions completed by WES during the years ended December 31, 2014, 2013 and 2012, and identifies the funding sources for such acquisitions:



thousands except unit and percent amounts	Acquisition Date	Percentage Acquired		Borrowings		Cash On Hand		WES Common Units Issued to Anadarko	WES Class C Units Issued to Anadarko	WES GP Units Issued
MGR ⁽¹⁾	01/13/2012	100	%	$	299,000	$	159,587	632,783	—	12,914
Chipeta ⁽²⁾	08/01/2012	24	%	—		128,250		151,235	—	3,086
Non-Operated Marcellus Interest ⁽³⁾	03/01/2013	33.75	%	250,000		215,500		449,129	—	—
Anadarko-Operated Marcellus Interest ⁽⁴⁾	03/08/2013	33.75	%	133,500		—		—	—	—
Mont Belvieu JV ⁽⁵⁾	06/05/2013	25	%	—		78,129		—	—	—
OTTCO ⁽⁶⁾	09/03/2013	100	%	27,500		—		—	—	—
TEFR Interests ⁽⁷⁾	03/03/2014	Various ⁽⁷⁾		350,000		6,250		308,490	—	—
DBM ⁽⁸⁾	11/25/2014	100	%	475,000		298,327		—	10,913,853	—

⁽¹⁾

The assets acquired from Anadarko consisted of (i) the “Red Desert complex,” which is located in the greater Green River Basin in southwestern Wyoming, and includes the Patrick Draw processing plant, the Red Desert processing plant, gathering lines, and related facilities, (ii) a 22% interest in Rendezvous, which owns a gathering system serving the Jonah and Pinedale Anticline fields in southwestern Wyoming, and (iii) certain additional midstream assets and equipment. These assets are collectively referred to as the “MGR assets” and the acquisition as the “MGR acquisition.”

⁽²⁾

WES acquired Anadarko’s additional Chipeta interest (as described in Note 1). WES received distributions related to the additional interest beginning July 1, 2012. This transaction brought WES’s total membership interest in Chipeta to 75%. The remaining 25% membership interest in Chipeta held by a third-party member is reflected as noncontrolling interests in the consolidated financial statements for all periods presented.

⁽³⁾

WES acquired Anadarko’s 33.75% interest (non-operated) (the “Non-Operated Marcellus Interest”) in the Liberty and Rome gas gathering systems (the “Non-Operated Marcellus Interest systems”), serving production from the Marcellus shale in North-central Pennsylvania. In connection with the issuance of WES common units, WES GP purchased 9,166 general partner units for consideration of $0.5 million.

⁽⁴⁾

WES acquired a 33.75% interest (the “Anadarko-Operated Marcellus Interest”) in each of the Larry’s Creek, Seely and Warrensville gas gathering systems (the “Anadarko-Operated Marcellus Interest systems”), which are operated by Anadarko and serve production from the Marcellus shale in North-central Pennsylvania, from a third party. During the third quarter of 2013, WES recorded a $1.1 million decrease in the assets acquired and liabilities assumed in the acquisition, representing the final purchase price allocation.


⁽⁵⁾	WES acquired a 25% interest in the Mont Belvieu JV, an entity formed to design, construct, and own two fractionation trains located in Mont Belvieu, Texas, from a third party. The interest acquired is accounted for under the equity method of accounting.


⁽⁶⁾	WES acquired Overland Trail Transmission, LLC (“OTTCO”), a Delaware limited liability company, from a third party. OTTCO owns and operates an intrastate pipeline that connects WES’s Red Desert and Granger complexes in southwestern Wyoming.

⁽⁷⁾

WES acquired a 20% interest in each of TEG and TEP and a 33.33% interest in FRP from Anadarko. These assets gather and transport NGLs primarily from the Anadarko and Denver-Julesburg (“DJ”) Basins. The interests in these entities are accounted for under the equity method of accounting. In connection with the issuance of WES common units, WES GP purchased 6,296 general partner units in exchange for WES GP’s proportionate capital contribution of $0.4 million.

⁽⁸⁾

WES acquired Nuevo Midstream, LLC (“Nuevo”) from a third party. Following the acquisition, WES changed the name of Nuevo to Delaware Basin Midstream, LLC (“DBM”). The assets acquired include cryogenic processing plants, a gas gathering system, and related facilities and equipment, which serve production from Reeves, Loving and Culberson Counties, Texas and Eddy and Lea Counties, New Mexico. These assets are referred to collectively as the “DBM complex.” See Note 4 for a discussion of the WES Class C units.

Purchase Price Allocation Table

The following is the preliminary allocation of the purchase price to the assets acquired and liabilities assumed in the DBM acquisition as of the acquisition date, pending the acquired entity’s final financial statements:



thousands
Current assets	$	46,358
Property, plant and equipment	440,971
Goodwill	279,051
Other intangible assets	835,566
Accounts payables	(13,064		)
Accrued liabilities	(24,824		)
Deferred income taxes	(1,450		)
Asset retirement obligations and other	(8,649		)
Total purchase price	$	1,553,959

Pro Forma Condensed Financial Information Table

The following table presents pro forma condensed financial information as if the DBM acquisition had occurred on January 1, 2013:



	Year Ended December 31,
thousands except per-unit amounts	2014		2013
Revenues	$	1,397,030	$	1,107,030
Net income	329,241		235,817
Net income attributable to Western Gas Equity Partners, LP	163,773		129,984
Net income per common unit – basic and diluted	0.75		0.57