8-KRegulation FDOther EventsExhibits & Filings

Energy Transfer LP 8-K Report, Regulation FD Disclosure (Jul 19, 2011)

Filed July 19, 2011For Securities:ETET-PI

Summary

Energy Transfer Equity, L.P. (ET) has announced an amended and restated merger agreement to acquire Southern Union Company (SUG) for approximately $9.4 billion. This revised agreement offers SUG stockholders a choice between $44.25 in cash or one common unit of ET for each SUG share, with flexibility in the cash and unit components. The maximum cash consideration is capped at 60%, while units will range from 40% to 50% of the total deal value, subject to proration if election limits are exceeded. The increased merger consideration also leads to higher termination fees and expense reimbursement amounts. Furthermore, ET and its subsidiary, Energy Transfer Partners, L.P. (ETP), have entered into an amended merger agreement concerning the contribution of a 50% interest in Citrus Corp., which holds the Florida Gas Transmission pipeline system, to ETP. This transaction, to occur concurrently with the SUG merger, involves approximately $1.895 billion in cash and $105 million in ETP common units in exchange for the Citrus Corp. stake. These announcements signal significant strategic expansion for Energy Transfer.

Key Highlights

  • 1Amended and restated merger agreement to acquire Southern Union Company (SUG) for approximately $9.4 billion.
  • 2SUG stockholders can elect to receive either $44.25 in cash or 1.000 common unit of Energy Transfer Equity (ET) per SUG share.
  • 3The merger consideration includes a flexible mix of cash (up to 60%) and ET common units (40%-50%), subject to proration.
  • 4Increased termination fees and expense reimbursement obligations related to the amended SUG merger agreement.
  • 5ET and Energy Transfer Partners (ETP) entered an agreement for SUG to contribute a 50% interest in Citrus Corp. (owner of Florida Gas Transmission) to ETP.
  • 6The Citrus Corp. contribution to ETP involves approximately $1.895 billion in cash and $105 million in ETP common units.
  • 7The Citrus Corp. transaction is anticipated to occur contemporaneously with the completion of the ET-SUG merger.

Frequently Asked Questions

The amended and restated merger agreement values Southern Union Company at approximately $9.4 billion.

Southern Union shareholders can elect to receive either $44.25 in cash or 1.000 common unit of Energy Transfer Equity (ET) for each SUG share they own. However, the total cash component is capped at 60% and the common unit component at 40%-50% of the aggregate consideration, with elections exceeding these limits subject to proration.

This transaction involves Southern Union contributing a 50% interest in Citrus Corp., which owns the Florida Gas Transmission pipeline system, to Energy Transfer Partners (ETP). This is in exchange for approximately $1.895 billion in cash and $105 million of ETP common units. This deal is expected to happen at the same time as the main merger between ET and SUG, suggesting a strategic integration of assets.

Yes, consistent with the increased merger consideration, the termination fees and expense reimbursement obligations contemplated by the existing merger agreement have been increased. The termination fee is now $181.3 million and the expense reimbursement is $54.0 million.