By Michael Erman

(Reuters) – Oil and gas producer Apache Corp (APA.N: Quote, Profile, Research, Stock Buzz) will buy privately held Cordillera Energy Partners III for $2.85 billion in cash and stock, expanding its holdings in one of the most lucrative emerging oil and gas fields in the United States.

It is the largest U.S. deal so far in 2012, according to Thomson Reuters data, and the second-largest deal worldwide.

Cordillera is owned by private equity firm EnCap Investments L.P. and other investors who will receive about $2.25 billion in cash and $600 million of Apache common stock for the assets.

The deal will double Apache’s acreage in the energy-rich Anadarko basin, a shale formation in western Oklahoma and the Texas panhandle in which the company has been drilling for more than 50 years.

Apache is particularly interested in Cordillera’s acreage in the Granite Wash geological formation within the Anadarko basin, which holds tight gas and natural gas liquids trapped in its sandstone.

“Because 80 percent of (Cordillera’s) revenue comes from liquid hydrocarbons production, this transaction provides compelling economics at current commodity prices,” Apache CEO Steven Farris said in a statement.

NEW YORK (Reuters) – Private equity firms Apollo Global Management LLC (APO.N: Quote, Profile, Research, Stock Buzz) and Riverstone Holdings have teamed up to bid around $7 billion for all of El Paso Corp’s (EP.N: Quote, Profile, Research, Stock Buzz) exploration and production assets, according to sources familiar with the matter.

Kinder Morgan Inc (KMI.N: Quote, Profile, Research, Stock Buzz), which struck a $21 billion deal to buy El Paso late last year, is weighing whether to sell the whole business as one or break it into six packages and sell those off separately, the sources said.

The banks advising Kinder Morgan on the sale — Barclays Plc’s (BARC.L: Quote, Profile, Research, Stock Buzz) Barclays Capital and Evercore Partners Inc (EVR.N: Quote, Profile, Research, Stock Buzz) — started peddling the separate packages earlier this week, three sources said. One of them said that indications of interest in the packages are due by mid-February.

Sources said that strategic bidders as well as other private equity firms would be interested in the packages.

Kinder Morgan agreed to buy rival El Paso in October in a bid to combine the two largest natural gas pipeline operators in North America. But Kinder Morgan was not interested in owning El Paso’s oil and gas exploration and production business and promptly put it on the block.

One source said Kinder Morgan would likely make a decision about how it planned to sell the business by the end of the month.

El Paso and Riverstone declined to comment, while an Apollo spokeswoman did not immediately respond to a request for a comment.

NEW YORK, Jan 18 (Reuters) – Private equity firms Apollo Global Management LLC (APO.N: Quote, Profile, Research) and Riverstone Holdings have teamed up to bid around $7 billion for all of El Paso Corp’s (EP.N: Quote, Profile, Research) exploration and production assets, according to sources familiar with the matter.

Kinder Morgan Inc (KMI.N: Quote, Profile, Research), which struck a $21 billion deal to buy El Paso late last year, is weighing whether to sell the whole business as one or break it into six packages and sell those off separately, the sources said.

The banks advising Kinder Morgan on the sale — Barclays Plc’s (BARC.L: Quote, Profile, Research) Barclays Capital and Evercore Partners Inc (EVR.N: Quote, Profile, Research) — started peddling the separate packages earlier this week, three sources said. One of them said that indications of interest in the packages are due by mid-February.

Sources said that strategic bidders as well as other private equity firms would be interested in the packages.

Kinder Morgan agreed to buy rival El Paso in October in a bid to combine the two largest natural gas pipeline operators in North America. But Kinder Morgan was not interested in owning El Paso’s oil and gas exploration and production business and promptly put it on the block.

One source said Kinder Morgan would likely make a decision about how it planned to sell the business by the end of the month.

El Paso and Riverstone declined to comment, while an Apollo spokeswoman did not immediately respond to a request for a comment.

NEW YORK (Reuters) – U.S. antitrust regulators are sending a clear message to companies contemplating gobbling up their rivals – don’t push it.

Companies have been testing the limits of U.S. antitrust scrutiny under the current administration, encouraged by little apparent change in enforcement policy despite initial expectations that President Barack Obama would take a much stricter view on competition issues than his predecessor, George W. Bush.

Turns out, that quietly changed. The Justice Department has indeed become more aggressive about antitrust enforcement than it was earlier, a source familiar with the regulator’s thinking said.

“Nobody wants to say it is based on politics, but I think there has been much greater willingness to be rigorous and thorough in the enforcement process and certainly no fear in going to court,” the person said. “We will see more severe remedies, more extensive remedies.”

The Justice Department had no immediate comment for this story. The Federal Trade Commission declined to comment.

As any large federal agency, change in the approach at the Justice Department is more nuanced than dramatic and is most apparent in borderline cases.

The vast majority of deals in any given year still go through without a review, but data shows a slight uptick in enforcement actions under the Obama administration as well as an acceleration of the review process that some attribute to a flattening of the bureaucracy at the regulatory agency.

NEW YORK, Dec 26 (Reuters) – U.S. antitrust regulators are sending a clear message to companies contemplating gobbling up their rivals – don’t push it.

Companies have been testing the limits of U.S. antitrust scrutiny under the current administration, encouraged by little apparent change in enforcement policy despite initial expectations that President Barack Obama would take a much stricter view on competition issues than his predecessor, George W. Bush.

Turns out, that quietly changed. The Justice Department has indeed become more aggressive about antitrust enforcement than it was earlier, a source familiar with the regulator’s thinking said.

“Nobody wants to say it is based on politics, but I think there has been much greater willingness to be rigorous and thorough in the enforcement process and certainly no fear in going to court,” the person said. “We will see more severe remedies, more extensive remedies.”

The Justice Department had no immediate comment for this story. The Federal Trade Commission declined to comment.

As any large federal agency, change in the approach at the Justice Department is more nuanced than dramatic and is most apparent in borderline cases.

The vast majority of deals in any given year still go through without a review, but data shows a slight uptick in enforcement actions under the Obama administration as well as an acceleration of the review process that some attribute to a flattening of the bureaucracy at the regulatory agency.

By Megha Mandavia and Michael Erman

(Reuters) – Vulcan Materials Co (VMC.N: Quote, Profile, Research, Stock Buzz) rejected Martin Marietta Materials Inc’s (MLM.N: Quote, Profile, Research, Stock Buzz) nearly $5 billion takeover bid, arguing that the all-stock bid undervalues the company and overstates the potential cost savings of a deal.

Vulcan’s rejection of Martin Marietta’s offer was widely expected, as the Birmingham, Alabama-based company had earlier indicated through court filings that it was not happy with the deal offered.

Shares of Vulcan, which have gained about 16 percent since the December 12 Martin Marietta offer, were up 0.3 percent at $39.21 on Thursday on the New York Stock Exchange.

Martin Marietta shares were down 0.7 percent at $75.64, meaning their bid is currently worth $37.82 for each Vulcan share. That is about 3 percent below Vulcan’s current share price.

“The offer is way too low,” Vulcan CEO Don James said in an interview. He said the bid ignored the value of Vulcan’s reserves, its earnings power during periods of economic recovery and execution risk from possible asset sales.

“It would dilute the much faster growth that Vulcan shareholders would enjoy on their own with a much lower growth profile from Martin Marietta,” James said.

LONDON/NEW YORK, Dec 16 (Reuters) – Dealmakers could find themselves with even more free time on their hands next year if Europe’s fiscal roadmap fails to convince investors and stabilize global markets.

In Europe, activity will be flat at best next year even if measures agreed to at last week’s EU summit restore confidence that the continent can overcome its debt crisis.

“We need at least two years before we have visibility on how or if things will stabilize. It is too early to call and any M&A rebound will depend entirely on this wider picture,” said Michael Tory, a former Lehman banker and a founding partner of London advisory boutique Ondra Partners.

Bankers in North America and Asia are hoping Europe will not pull them down with it.

“If we see stabilization in Europe — not necessarily a lot of growth — then I believe deals can get done and priced appropriately,” said Steve Baronoff, chairman of global M&A at Bank of America Merrill Lynch. “Unless Europe experiences significant upheaval, the intermediate term for M&A has some very good macro factors.”

Merger and acquisition volume in the Asia-Pacific region, excluding Japan, is set to rise by a third next year after dipping in 2011, according to Thomson Reuters/Freeman Consulting estimates, as cashed-up Asian companies step up acquisitions to take advantage of depressed asset prices.

“If you are working closely with a company getting ready to push the button to do a deal, and the market is souring in Europe, companies will pause,” said Todd Marin, JPMorgan’s head of investment banking for the Asia-Pacific region.

By Michael Erman

(Reuters) – Construction aggregates maker Martin Marietta Materials Inc (MLM.N: Quote, Profile, Research, Stock Buzz) launched a hostile $4.8 billion all-stock offer to buy larger rival Vulcan Materials Co (VMC.N: Quote, Profile, Research, Stock Buzz) in a bid to build a global leader in an industry that has been battered by the housing-market downturn.

Martin Marietta would exchange 0.5 share of its stock for each Vulcan share. As of Friday’s close, the bid was worth $36.69 a share, a 9 percent premium to Vulcan’s closing price of $33.55.

Shares of both companies rose after the bid was announced on Monday, with Vulcan jumping 15 percent to $38.70, nearly 4 percent above the bid’s value. Martin Marietta shares were up 1.7 percent at $74.61.

Martin Marietta Chief Executive Ward Nye said his company decided to go forward with the bid on its own because conversations with Vulcan were not going anywhere.

“At the end of the day, you feel like there’s $2 billion there,” Nye said in an interview, referring to the market value of the $200 million to $250 million in annual savings that he believes the companies could extract from the deal. “This is too much shareholder value … to walk away from in good faith.”

Vulcan and Martin Marietta have seen their earnings power sag since 2007, when the U.S. housing market collapsed. The construction materials companies also depend on highway funding and might benefit from consolidation, with little sign of a U.S. highway bill being passed in the near term.

NEW YORK (Reuters) – The Texas power company taken over in the largest ever leveraged buyout needs what many consider long-shots, higher natural gas and power prices, to help keep the lights on.

Formerly known as TXU Corp when it was taken over in 2007 by private equity, Energy Future Holdings is now struggling under a heavy debt load, and faces strong headwinds in the form of low power prices and higher costs related to environmental regulations.

Despite refinancing nearly $18 billion of debt earlier this year, EFH could face its day of reckoning as soon as 2014 if it is not able to make key changes to its current debt structure.

“It’s kind of like Greece — by any cold, sober analysis, the math doesn’t work,” said one power investment banker who spoke on the condition of anonymity.

Despite the huge refinancing, “they haven’t fundamentally changed the answer,” the banker said.

TXU was taken over by a consortium of private equity firms including KKR and Co (KKR.N: Quote, Profile, Research, Stock Buzz) and Texas Pacific Group TPG.UL, in 2007, but gas prices have fallen sharply since that deal. And that’s bad for power companies in Texas where power prices generally track natural gas prices.

EFH declined to comment for this story. It said earlier this year that the extension of the debt it completed in April “provides the company with more time to create additional enterprise value and give power markets the opportunity to recover.”

NEW YORK, Nov 22 (Reuters) – The Texas power company taken over in the largest ever leveraged buyout needs what many consider long-shots, higher natural gas and power prices, to help keep the lights on.

Formerly known as TXU Corp when it was taken over in 2007 by private equity, Energy Future Holdings is now struggling under a heavy debt load, and faces strong headwinds in the form of low power prices and higher costs related to environmental regulations.

Despite refinancing nearly $18 billion of debt earlier this year, EFH could face its day of reckoning as soon as 2014 if it is not able to make key changes to its current debt structure.

“It’s kind of like Greece — by any cold, sober analysis, the math doesn’t work,” said one power investment banker who spoke on the condition of anonymity.

Despite the huge refinancing, “they haven’t fundamentally changed the answer,” the banker said.

TXU was taken over by a consortium of private equity firms including KKR and Co and Texas Pacific Group, in 2007, but gas prices have fallen sharply since that deal. And that’s bad for power companies in Texas where power prices generally track natural gas prices.

EFH declined to comment for this story. It said earlier this year that the extension of the debt it completed in April “provides the company with more time to create additional enterprise value and give power markets the opportunity to recover.”