Harbinger Group and EXCO joint venture plans $225 million bank debt

By Sara Rosenberg

New York, Nov. 5 - Harbinger Group Inc. and EXCO Resources Inc. announced a joint venture to create a private oil and gas limited partnership and this joint venture plans on getting $225 million of bank debt, according to a news release.

Under the agreement, the joint venture will acquire oil and gas assets in West Texas from EXCO for about $725 million, subject to customary closing adjustments.

In addition to being financed with the loan borrowings, the purchase will be funded by $372.5 million in cash contributed from Harbinger and $127.5 million in oil and gas properties and related assets being contributed by EXCO.

In exchange for its cash investment, Harbinger will receive a 75% limited partnership interest in the venture and a 50% member interest in the general partner of the venture, and in exchange for its asset contribution, EXCO will receive about $597.5 million in cash proceeds as well as a 25% limited partner interest and a 50% member interest in the General Partner.

Closing is expected in early 2013, subject to customary conditions, including title and environmental reviews, receipt of applicable approvals and consents and receipt of bank debt.

Harbinger is a New York-based diversified holding company and EXCO is a Dallas-based oil and natural gas company.

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