Skip to main content

ONEOK to buy Magellan Midstream Partners for US$18.8 billion

Published by , Senior Editor
World Pipelines,


ONEOK Inc. agreed on Sunday to buy US pipeline operator Magellan Midstream Partners in a cash-and-stock deal valued at about US$18.8 billion including debt, bringing natural gas-focused ONEOK into transporting refined products and oil, reports Reuters.

ONEOK will pay US$25 and 0.6670 shares of ONEOK common stock for each outstanding Magellan common unit, representing a premium of 22% based on Magellan shares' closing price on 12 May. The buyer will also assume Magellan's US$5 billion debt pile.

The deal will give ONEOK, until now a transporter of natural gas liquids and natural gas, access to Magellan's refined products and crude oil transportation business. The combined company will have 44% of its business in NGLs, and 21% in refined products, according to a presentation.

"The combination of ONEOK and Magellan will create a diversified North American midstream infrastructure company with predominately fee-based earnings, a strong balance sheet and significant financial flexibility," ONEOK CEO Pierce H. Norton II, who will head the combined company, said in a statement.

The deal, expected to close in 3Q23, should be accretive to ONEOK's earnings per share beginning in 2024, with EPS accretion of 3% to 7% per year from 2025 through 2027.

The combined company will own more than 25 000 miles of liquids-oriented pipelines, with significant assets and operational expertise at the Gulf Coast and Mid-Continent market hubs.

 

 

Read the latest issue of World Pipelines magazine for pipeline news, project stories, industry insight and technical articles.

World Pipelines’ May 2023 issue

The May 2023 issue of World Pipelines includes a special section on pipeline design and operation in extreme environments. Also featured are technical articles on field joint coatings, pipeline steels, and safety and risk management for pipeline networks.

Read the article online at: https://www.worldpipelines.com/business-news/15052023/oneok-to-buy-magellan-midstream-partners-for-us188-billion/

You might also like

 
 

Embed article link: (copy the HTML code below):


 

This article has been tagged under the following:

US pipeline news Acquisitions and mergers


 

World Pipelines is not responsible for the content of external internet sites.