Skip to content
AnalystLens

ONEOK INC /NEW/ 8-K Report, Material Agreement (Sep 16, 2024)

Reports
Material Agreements·Regulation FD·Exhibits & Filings
Filing Date
Filed September 16, 2024
Period End
September 10, 2024
Security
OKE
In the record · 2016–202610-K1110-Q328-K365

OKE filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 365 current reports (8-K) between 2016 and 2026.

  1. Deal closed8-K · Jul ’17Jul ’17
  2. Leadership change8-K · Feb ’19Feb ’19
  3. Material agreement8-K · Jun ’22Jun ’22
  4. Material agreement8-K · Sep ’26Sep ’26

01—Abstract

Summary

Summary of the 8-K filed September 16, 2024. Cited figures are marked; the original filing is the authoritative source.

ONEOK, Inc. (NYSE: OKE) priced a $7.0 billiona senior notes offering on September 10, 2024, with ONEOK Partners, ONEOK Partners Intermediate and Magellan Midstream Partners guaranteeing the notes.

The offering spans six tranches from 3-year to 40-year maturities, with coupons ranging from 4.25% to 5.85%, and is expected to close on or about September 24, 2024. Net proceeds of approximately $6.92 billionb are earmarked primarily to fund ONEOK's acquisition of Global Infrastructure Partners' (GIP) interests in EnLink Midstream, LLC and Medallion Midstream, LLC, with any remainder for general corporate purposes, potentially including repayment or repurchase of existing debt. The filing signals a major step in ONEOK's expansion of its midstream footprint through the EnLink transaction.

The sizable long-dated issuance (including $2.3 billionc of 30- and 40-year notes) suggests management is locking in long-term financing for the acquisition. Investors should note that the 3-, 5- and 7-year notes carry a special mandatory redemption feature if the EnLink transaction is not completed by the outside date, the purchase agreement is terminated, or ONEOK notifies the trustee it will not pursue the deal. The 8-K also discloses customary underwriting terms and the relationships between ONEOK and the underwriters, several of whom are lenders under ONEOK's credit facilities and dealers under its commercial paper program.

The forward-looking statements flag risks including regulatory approval, closing conditions, changes in credit ratings, capital structure effects and commodity price declines. The disclosure is a financing event tied directly to a pending acquisition, so its significance depends on closing of the EnLink and Medallion transactions.

02—Key points

Key Highlights

  1. ONEOK priced $7.0 billion of senior notes across six tranches maturing in 2027, 2029, 2031, 2034, 2054 and 2064, with coupons from 4.25% to 5.85%.
  2. Net proceeds of approximately $6.92 billion are expected, primarily to fund the purchase of GIP's interests in EnLink Midstream, LLC and Medallion Midstream, LLC.
  3. The offering is guaranteed by ONEOK Partners, L.P., ONEOK Partners Intermediate Limited Partnership and Magellan Midstream Partners, L.P.
  4. Closing is expected on or about September 24, 2024, subject to customary closing conditions.
  5. The $3.0 billion... specifically, $1.25B 2027, $600M 2029 and $1.25B 2031 notes are not the only instruments: the 3-, 5- and 7-year tranches (totaling $3.1 billion) carry a special mandatory redemption if the EnLink transaction fails or is terminated.
  6. Long-dated issuance of $2.3 billion in 30- and 40-year notes provides extended-duration financing for the acquisition.
  7. Underwriters include J.P. Morgan, Goldman Sachs, Barclays, BofA Securities and Wells Fargo, several of which are also lenders under ONEOK's credit facilities and commercial paper dealers.

03—Questions

Frequently Asked Questions

  1. What is ONEOK using the $7.0 billion in note proceeds for?

    The net proceeds, about $6.92 billion, are intended primarily to fund the purchase price for GIP's interests in EnLink Midstream, LLC and Medallion Midstream, LLC, plus related fees and expenses. Any remaining proceeds may be used for general corporate purposes, including repaying or repurchasing existing debt.

  2. What happens to the notes if the EnLink acquisition does not close?

    The 3-year, 5-year and 7-year notes ($3.1 billion in total) are subject to a special mandatory redemption if the EnLink transaction is not completed by the EnLink Outside Date, the EnLink Purchase Agreement is terminated, or ONEOK notifies the trustee it will not pursue the transaction. The filing indicates the redemption terms are detailed in the prospectus supplement.

  3. When will the offering close and who guarantees the notes?

    The offering is expected to close on or about September 24, 2024, subject to customary closing conditions. The notes are guaranteed by ONEOK Partners, L.P., ONEOK Partners Intermediate Limited Partnership and Magellan Midstream Partners, L.P.

  4. What are the risks to the transaction that investors should monitor?

    Forward-looking risks cited include changes in credit ratings after the proposed transactions, failure to satisfy closing conditions or termination of agreements, regulatory approval risk, adverse reactions to business or employee relationships, changes to ONEOK's capital structure affecting its securities' market value, access to financing and liquidity, and the impact of economic downturns or substantial commodity price declines.

04—Continue

← View all 8-K filings