Western Midstream to buy Aris Water for $1.5 billion

Aug 6 (Reuters) - Western Midstream Partners WES.N said on Wednesday it will acquire Aris Water Solutions ARIS.N in a cash-and-stock deal valued at about $1.5 billion as it aims to diversify operations in the Permian Basin.

Shares of Aris Water Solutions jumped over 21% after the bell.

Western Midstream — a natural gas-focused pipeline operator — has been seeking to create a leading water infrastructure platform in the top U.S. oilfield and diversify its customer base across West Texas and southeastern New Mexico.

It said the acquisition would extend its existing footprint far to the north into Lea and Eddy Counties in New Mexico while providing access to incremental throughput opportunities across its natural-gas, crude-oil and produced-water businesses.

Aris' full-cycle water infrastructure assets include 790 miles of produced-water pipeline, 1.8 million barrels per day (mmbd) of produced-water handling capacity, 1.4 mmbd of water recycling capacity, and 625,000 dedicated acres from investment-grade counterparties.

The acquisition would create a "produced-water gathering, disposal, and recycling business that can meet the flow assurance needs of customers," Western Midstream CEO Oscar Brown said.

U.S. shale producer Occidental Petroleum OXY.N holds a 43.5% stake in the pipeline operator.

Aris shareholders will receive 0.625 common units of Western Midstream for each Aris share, or $25 per share in cash. The maximum cash consideration for the transaction is $415 million.

The deal is expected to close in the fourth quarter of 2025.