Diamondback Energy and KKR agreed to acquire Five Point Infrastructure's 70% stake in Deep Blue Midland Basin. The deal reportedly involves an estimated $2.1 billion in consideration.
Diamondback Energy and KKR agreed to acquire Five Point Infrastructure's 70% stake in Deep Blue Midland Basin, a Permian Basin water infrastructure firm. The financial terms were not disclosed by the companies; a source familiar with the matter said the consideration is estimated at $2.1 billion.
Diamondback already owns the remaining 30% stake in Deep Blue, whose system supports nearly 2 million barrels of water per day for Diamondback's operations. Truist Securities analysts estimate Diamondback will contribute about $602 million to raise its ownership to 50%, while KKR will pay about $1.51 billion for the remaining 50%, assuming equal pro-rata pricing and no acquisition-level financing, fees or earnout settlement.
The transaction is expected to close in the fourth quarter this year. The companies said the investment could pave the way for further joint infrastructure investments as energy and industrial activity expands across the Permian Basin.
