Summary
Dominion Energy, Inc. (D) has filed an 8-K report on November 27, 2018, announcing a significant corporate action: the execution of a Merger Agreement to acquire Dominion Energy Midstream Partners, LP (DM). This transaction involves DM being merged with and into a wholly-owned subsidiary of Dominion Energy, with DM as the surviving entity. The primary financial implication for DM unitholders is the conversion of their outstanding common units (DM Public Common Units) into Dominion Energy common stock at a ratio of 0.2492 shares per DM common unit. Additionally, DM public unitholders may receive a cash dividend if the merger closing occurs after the record date for Dominion Energy's first quarter 2019 dividend. Preferred unitholders (DM Series A Preferred Units) have options to convert or be redeemed before the merger. This move signals Dominion Energy's intent to consolidate its midstream assets and simplify its corporate structure.
Key Highlights
- 1Dominion Energy announced a definitive Merger Agreement to acquire Dominion Energy Midstream Partners, LP (DM).
- 2The transaction is structured as a merger where DM will be the surviving entity, and its public unitholders will receive Dominion Energy common stock.
- 3Each DM Public Common Unit will be converted into 0.2492 shares of Dominion Energy common stock.
- 4DM unitholders may receive additional cash consideration equal to Dominion Energy's Q1 2019 dividend if the merger closes after the dividend record date.
- 5DM Series A Preferred Units have options to convert into common units or be redeemed for cash or DM common units prior to the merger.
- 6The Boards of Directors for both Dominion Energy and DM's conflicts committee have approved the merger, and DM unitholder approval is required for closing.
- 7The transaction is subject to customary closing conditions, including the effectiveness of a Form S-4 registration statement.