Crestwood Midstream Partners LP (NYSE:CMLP) and Crestwood Holdings Partners, LLC entered into a purchase agreement to acquire Marcellus shale gathering system assets from Antero Resources Appalachian Corporation for approximately $420 million in cash on February 24, 2012. Under the terms of the agreement, cash payment is $375 million and there will also be an earn-out which would allow Antero to earn additional purchase price payments of up to $40 million based upon average annual production levels achieved during 2012 and 2013. Crestwood Holdings will contribute $244 million in exchange for 65% ownership interest and Crestwood Midstream will contribute approximately $131 million in exchange for 35% ownership interest. Additionally, Crestwood Midstream and Crestwood Holdings agreed to enter into a 20-year gas gathering and compression agreement, which will provide for an Area of Dedication of approximately 127,000 gross acres, or 104,000 net acres, largely located in the rich gas window of the southwestern core of the marcellus shale play. At closing, the joint venture will also enter into a $200 million revolving credit facility to finance future capital requirements related to growth in the Area of Dedication. Crestwood Midstream will fund the transaction under its existing $500 million credit facility. Crestwood Holdings arranged for long term financing commitments from a syndicate of banks including BofA Merrill Lynch, BNP Paribas, Citigroup, RBC Capital Markets, Royal Bank of Scotland plc and UBS Securities which will also participate in the joint venture credit facility. Crestwood Midstream and Crestwood Holdings will utilize available capacity under senior secured credit facility to fund its contribution to the transaction. The transaction is subject to regulatory approvals, expiration of all waiting periods under the Hart- Scott- Rodino Antitrust Improvements Act of 1976, gathering agreement, transition services agreement and customary closing conditions and is expected to close in March 2012. The proceeds from the sale will be used for further development of Antero's Appalachian drilling inventory as well as for future leasehold acquisition. The acquisition will be immediately accretive to Crestwood Midstream. Lee Jacobe and Will Byers of Barclays Capital Inc. acted as financial advisor and Yvette K. Schultz, Jeff Munoz, Robin Fredrickson, Mark Brazzil, Tim Devetski, and Michael Collins of Vinson & Elkins LLP acted as legal advisor to Antero. Kevin Peter of Locke Lord Bissell & Liddell LLP and J. Alden Millard of Simpson Thacher & Bartlett LLP acted as legal advisors to Crestwood Midstream and Crestwood Holdings. Ernst & Young, LLP acted as accountant in the transaction. Mike O'Leary, David Denechaud and Cindy Lin of Andrews Kurth LLP acted as legal advisors to First Reserve Corporation, an indirect owner of Crestwood Holdings Partners LLC. David Denechaud of Andrews Kurth LLP acted as legal advisor to Crestwood Marcellus Holdings LLC. H. William Swanstrom represented Crestwood Marcellus Pipeline LLC. Crestwood Midstream Partners LP (NYSE:CMLP) and Crestwood Holdings Partners, LLC completed the acquisition of Marcellus shale gathering system assets from Antero Resources Appalachian Corporation on March 26, 2012.