Magnum Hunter Looks to Shed Pipeline Stake

Oil and natural gas producer Magnum Hunter Resources Corp said it expected to raise $600-$700 million by selling its 45.53 percent stake in its natural gas gathering subsidiary, Eureka Hunter Holdings.

A deal will allow Magnum Hunter to restructure its balance sheet and shore up liquidity, the company said. (http://1.usa.gov/1LEbpvK)

Magnum Hunter said in May it expected to raise about $50 million by selling a part of its interest in Eureka Hunter.

The company, focused on natural gas production in the Marcellus and Utica Shales, has been struggling to cope with weak prices for the fuel.
 
Magnum Hunter said in January it cut all capital spending as commodity prices were expected to remain low this year.

Magnum Hunter had $13.7 million in cash and cash equivalents and total debt of $951 million as of March 31, according to Thomson Reuters data.

Morgan Stanley Infrastructure, the U.S. bank's infrastructure investing arm, owns a majority stake in Eureka Hunter.

Eureka Hunter owns Eureka Hunter Pipeline LLC, which operates natural gas pipelines in southeastern Ohio and northern West Virginia

Eureka Hunter also owns TransTex Hunter LLC, which provides natural gas treating and processing service solutions. Magnum Hunter's shares, which closed at $1.75 on Wednesday,
had fallen more than 78 percent in the past 12 months.

Reporting By Manya Venkatesh