Matador’s San Mateo Completes $752M Cardinal Midstream Buy
Event summary
- San Mateo Midstream, Matador’s 51%-owned JV, acquired Cardinal Midstream for $752M in cash.
- The deal adds 320 MMcf/d of processing capacity and 145 miles of gathering pipelines in the northern Delaware Basin.
- San Mateo financed the acquisition via a $650M term loan, cash on hand, and partner contributions.
- Matador retained its policy of funding midstream acquisitions without tapping its own balance sheet.
The big picture
This acquisition solidifies San Mateo as the largest private gas processor in the northern Delaware Basin, a strategic move amid rising basin-wide demand for midstream consolidation. Matador’s financing approach underscores its disciplined capital allocation, avoiding balance sheet dilution while expanding its controlled infrastructure network.
What we're watching
- Integration Execution
- How San Mateo will absorb Cardinal’s assets and personnel to maintain operational reliability.
- Third-Party Growth
- Whether the expanded infrastructure can attract additional producer customers in a competitive basin.
- Debt Repayment Timing
- The pace at which San Mateo will repay its $650M term loan due July 2027, given Cardinal’s projected EBITDA ramp-up.
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