Antero Midstream Simplification Transaction OCTOBER 9, 2018
Special Committee Process Objectives While evaluating potential alternatives to increase shareholder value, there were a number of key objectives: 1 Achieve a win-win-win Transaction Across the Antero Family - Improve the financial…
Todays Strategic Announcement Completed the Special Committee process 1 AMGP to acquire AM in a midstream simplification transaction - AM public unitholders receive all-in consideration valued at 31.41/unit - Eliminates IDRs, lowering…
Best in Class Midstream Vehicle Simplification checks all the boxes for midstream investors Attribute Antero Midstream Corporation 1099 Tax Form C-corp for tax and governance purposes with 1099 tax form No IDRs One publicly traded…
Simplification Transaction Overview Antero Midstream GP LP (AMGP) to acquire Antero Midstream Partners LP (AM) creating a premier Appalachian infrastructure organic growth corporation Antero Midstream Corporation (NYSE: AM) or New AM…
Antero Family Simplified Pro Forma Structure Midstream simplification transaction results in one publicly traded midstream infrastructure corporation with no IDRs and AR as its largest shareholder Status Quo Structure Simplified Pro…
New AM Increased Cash Dividend Targets New AM will increase its initial 2019 dividend and target the same year-over-year growth rates as legacy AM distributions with stronger DCF coverage (as a result of tax savings through 2022 and…
Simplification Transaction Sources & Uses Transaction Sources and Uses Sources MM Uses MM AMGP Common Equity Issuance(1) 5,510 Acquisition of AM (Equity) 5,510 Revolving Credit Facility 619 Acquisition of AM (Cash) 598 Estimated…
Highest Dividend Growth Among Top 20 Midstream New AM will be a unique midstream vehicle with scale, low leverage and high distribution growth all in a C-corp structure C-CORP MLP Leverage 3-Year Dividend CAGR (2018 2021) *…
Yield vs. Growth Correlation Implies Attractive Value Antero Midstream Corporations dividend growth profile supports a premium valuation based on comparable C-corps and entities that eliminated IDRs Yield vs. Dividend/Distribution…
Simplification Transaction Summary 1 Simplifies midstream structure and aligns all Antero equity holders C-Corp structure without IDRs is the increasingly preferred structure by investors Broadens potential investor base and creates…
Appendix
Long-term Outlook Status Quo vs. Pro Forma Entity Targets / Policies Status Quo Pro Forma Change 29% Through 2020 29% Through 2020 Distribution Growth Targets 20% in 2021 & 2022 20% in 2021 & 2022 No Change 1.2x1.3x through 1.2x…
Series B Profits Elimination Prior to Simplification: The Series B profits interests were created in December 2016 through an agreement between Anteros co-founders and private equity sponsors, who jointly owned 100% of IDR LLC prior to…
Antero Midstream Non-GAAP Measures Non-GAAP Financial Measures and Definitions Antero Midstream views Adjusted EBITDA as an important indicator of the Partnerships performance. Antero Midstream defines Adjusted EBITDA as Net Income…
Adjusted EBITDA and DCF Reconciliation Adjusted EBITDA and DCF Reconciliation ( in thousands) Three months ended June 30, 2017 2018 Net income 87,175 109,466 Interest expense 9,015 14,628 Impairment of property and equipment…
Antero Midstream Non-GAAP Measures The following table reconciles consolidated total debt to consolidated net debt (Net Debt) as used in this presentation (in thousands): June 30, 2018 Bank credit facility 770,000 5.375% AM senior…
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