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ONEOK INC /NEW/ 8-K Report, Material Agreement (May 15, 2023)

Filed May 15, 2023For Securities:OKE

Summary

ONEOK Inc. (OKE) has announced a significant strategic move with the entry into a Material Definitive Agreement to acquire Magellan Midstream Partners, L.P. (MMP). The merger, approved by the boards of both companies, will see Magellan Midstream Partners, L.P. become a wholly-owned subsidiary of ONEOK. This acquisition is structured as a merger where each Magellan common unit will be converted into a combination of ONEOK common stock and a cash payment. Specifically, Magellan unitholders will receive 0.667 shares of ONEOK common stock and $25.00 in cash for each Magellan unit they own. The transaction is subject to customary closing conditions, including Magellan unitholder approval and ONEOK shareholder approval for the stock issuance, as well as regulatory approvals such as HSR clearance. ONEOK has secured a $5.25 billion bridge loan facility to finance the cash portion of the transaction.

Key Highlights

  • 1ONEOK, Inc. to acquire Magellan Midstream Partners, L.P. in a definitive merger agreement.
  • 2Magellan unitholders to receive 0.667 ONEOK shares and $25.00 cash per Magellan unit.
  • 3Transaction approved by the boards of directors of both ONEOK and Magellan.
  • 4Merger completion is contingent on customary closing conditions, including shareholder and unitholder approvals and regulatory clearances.
  • 5ONEOK has secured a $5.25 billion unsecured bridge loan facility to finance the cash consideration.
  • 6The agreement includes provisions for non-solicitation of competing proposals and defined termination fees for both parties.
  • 7ONEOK expects the transaction to be accretive to earnings and free cash flow.

Frequently Asked Questions

ONEOK, Inc. has entered into an agreement to acquire Magellan Midstream Partners, L.P. The transaction is structured as a merger where Magellan will become a wholly-owned subsidiary of ONEOK.

Each common unit of Magellan Midstream Partners will be converted into 0.667 shares of ONEOK common stock and $25.00 in cash.

ONEOK has entered into a debt commitment letter for a $5.25 billion unsecured 364-day bridge loan facility to finance the cash portion of the transaction.

The completion of the merger is subject to several conditions, including the adoption of the merger agreement by Magellan unitholders, approval of the ONEOK share issuance by ONEOK shareholders, expiration of HSR waiting periods, effectiveness of ONEOK's Form S-4 registration statement, and other customary closing conditions.