ONEOK to Acquire Medallion Midstream and Controlling Stake in EnLink Midstream for $5.9 Billion
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ONEOK has executed a definitive agreement with Global Infrastructure Partners (GIP) where ONEOK will acquire GIP’s entire interest in EnLink Midstream.
The agreement consists of 43 percent of EnLink’s outstanding common units for $14.90 per unit and 100 percent of the interests in the managing member for $300 million, for total cash consideration of approximately $3.3 billion.
ONEOK and GIP also entered into a separate definitive agreement under which ONEOK will acquire from GIP all of the equity interests in Medallion Midstream for $2.6 billion. Medallion is the largest privately held crude gathering and transportation system in the Permian’s Midland Basin
“ONEOK has a longstanding reputation as being intentional in building a premier energy infrastructure company, and today’s transactions further solidify that status by adding complementary assets that allow us to continue expanding and extending our value chain,” said Pierce Norton II, ONEOK president and chief executive officer.
“We are particularly excited to meaningfully increase our company’s presence in the Permian Basin, which is expected to continue driving the majority of U.S. oil and gas growth. ONEOK has demonstrated its ability to bring assets together and capture synergies, and we are confident that these accretive transactions will enhance value for our stakeholders and will allow us to provide enhanced offerings across multiple ONEOK platforms,” added Norton.
“We are also looking forward to welcoming the employees of EnLink and Medallion to ONEOK,” concluded Norton.
After the closing of the purchase of GIP’s interests in EnLink Midstream, ONEOK intends to pursue the acquisition of the publicly held common units of EnLink in a tax-free transaction. The fully combined ONEOK and EnLink asset bases would be expected to enhance synergies, reduce leverage, and increase accretion to ONEOK shareholders.
In addition, a combination with ONEOK is expected to give EnLink unitholders access to ONEOK’s stock which is part of the S&P 500, and which has significantly greater trading liquidity and an attractive dividend yield.
Upon closing of the EnLink transaction, ONEOK will have control of EnLink’s managing member and intends to replace the board members currently designated by GIP with new board members designated by ONEOK.
ONEOK will maintain its headquarters in Tulsa, Oklahoma, and intends to retain a meaningful employee presence in the Dallas and Houston metropolitan areas.
ONEOK delivers energy products and services vital to an advancing world. They are a leading midstream operator that provides gathering, processing, fractionation, transportation, and storage services. Through their more than 50,000-mile pipeline network, they transport the natural gas, natural gas liquids (NGLs), refined products, and crude that help meet domestic and international energy demand, contribute to energy security and provide safe, reliable and responsible energy solutions needed today and into the future. As one of the largest diversified energy infrastructure companies in North America, ONEOK is delivering energy that makes a difference in the lives of people in the U.S. and around the world.
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