ONEOK will buy Magellan Midstream Partners in a cash-and-stock deal valued at $18.8 billion, creating a combined U.S. oil and gas pipeline giant with a total enterprise value of $60 billion.
Under a merger agreement, primarily gas-focused ONEOK will buy all outstanding units of Magellan for $25.00 in cash and 0.6670 shares of ONEOK common stock for each outstanding Magellan common unit.
This would represent a current implied value to each Magellan unitholder of $67.50 per unit, for a 22% premium, based on May 12, 2023 closing prices.
With the acquisition of Magellan, ONEOK adds a primarily fee-based, refined products and crude oil transportation business.
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.
