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Latham & Watkins Advises Diversified Gas & Oil Corporation in First-of-its-Kind Securitization of Operated Proved-Developed Assets

November 14, 2019
The complex transaction created a new finance structure to benefit the company’s business model.

Diversified Gas & Oil PLC ("Diversified"), a US-based owner and operator of natural gas, natural gas liquids, oil wells, and midstream assets in the Appalachian Basin, has announced the closing of the first-of-its-kind securitization of operated upstream proved-developed assets. Diversified has formed a wholly owned (and fully consolidated for accounting purposes) special purpose vehicle, Diversified ABS LLC (the "LLC"), that will issue non-recourse, asset-backed securities (the "Notes") in a private placement transaction. The LLC also entered into a complex and bespoke portfolio of hedging arrangements covering the assets supporting the Notes. 

Latham & Watkins LLP represented Diversified Gas & Oil Corporation in the groundbreaking transaction with a team led by Houston corporate partners Jeff Munoz, David Miller, Robin Fredrickson, New York finance partner Loren Finegold, and New York derivatives and regulatory partner Yvette Valdez, with Houston associates Sean McKinley, Alice Parker, Bryan Ryan, Drew Tengler-West, and Sam Bentley and Washington, D.C. associate Brett Ackerman. Advice was also provided on tax matters by Houston partner Tim Fenn and New York partner Elena Romanova with Houston associate Jim Cole; on benefits and compensation matters by Los Angeles partner Michelle Carpenter; on environmental matters by Houston partner Joel Mack with Washington, D.C. associate Joshua Marnitz; and on finance matters by Houston partner Pamela Kellet.