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El Paso, Kinder Morgan Near $7 Billion Sale of Assets (EP, KMI, APO)

The $21 billion merger between El Paso Corp. (NYSE: EP) and Kinder Morgan Inc. (NYSE: KMI) likely depends on whether or not the proposed combination can shed some assets. Such a deal now appears close at hand, following reports that…

By Paul Ausick
Published February 24, 2012, 2:43pm ET · 1 min read

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The $21 billion merger between El Paso Corp. (NYSE: EP) and Kinder Morgan Inc. (NYSE: KMI) likely depends on whether or not the proposed combination can shed some assets. Such a deal now appears close at hand, following reports that Apollo Global Management LLC (NYSE: APO) is leading a group of buyers who are preparing to make a $7 billion offer the exploration & production assets of El Paso.

El Paso originally intended to spin-off the assets, but following the proposed acquisition by Kinder Morgan, the companies decided to try to sell the assets if a buyer could be found. Apollo was mentioned last month as a likely suspect.

According to a report at Bloomberg News, Apollo will finance the acquisition with $5.5 billion debt financing, $3.5 billion in bonds and a $2 billion loan.

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Paul Ausick

Paul Ausick has been writing for 247Wallst.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.

He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.

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