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Plains All American Pipeline 8-K Report, Material Agreement (Jun 17, 2025)

Reports
Material Agreements·Regulation FD·Exhibits & Filings
Filing Date
Filed June 17, 2025
Period End
June 17, 2025
Securities
PAAPAAPU
In the record · 2016–202610-K1110-Q328-K168

PAA filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 168 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Oct ’17Oct ’17
  2. Leadership change8-K · Sep ’20Sep ’20
  3. Material agreement8-K · Aug ’22Aug ’22
  4. Leadership change8-K · Sep ’26Sep ’26

01—Abstract

Summary

Summary of the 8-K filed June 17, 2025. Cited figures are marked; the original filing is the authoritative source.

On June 17, 2025, a wholly-owned subsidiary of Plains All American Pipeline, L.P.

(PAA) entered into a definitive Share Purchase Agreement with Keyera Corp. to sell all outstanding shares of Plains Midstream Canada ULC, the PAA subsidiary that owns substantially all of its natural gas liquids (NGL) business. The cash purchase price is approximately C$5.15 billiona, subject to adjustments, which the accompanying press release states is about $3.75 billion USD. PAA will retain substantially all U.S. NGL assets and all Canadian crude oil assets, and it will guarantee certain of the seller's obligations under the agreement.

The transaction is expected to close in the first quarter of 2026, subject to customary conditions, including regulatory approvals. According to the press release, net proceeds are expected to be approximately $3.0 billionb USD after taxes, transaction expenses and a potential one-time special distribution of an estimated $0.35 per unit, which is subject to Board approval and closing. Management states that the purchase price represents approximately 13x expected 2025 Distributable Cash Flow and that the sale will reduce commodity-related EBITDA, seasonality and working capital requirements.

Proceeds are to be prioritized toward disciplined bolt-on M&A, possible repurchases of Series A and Series B Preferred units, and opportunistic common unit repurchases. Management also expects post-closing leverage at or below the low end of its target range. The closing is a taxable event expected to flow taxable income through to PAA common unitholders, with PAA estimating approximately $360 millionc USD of Canadian entity-level taxes.

The filing states that an expected foreign tax credit, together with any passive activity loss carryforwards, should offset a significant portion of, and in some cases all of, the taxable gain passed to individual unitholders. Plains also does not anticipate paying meaningful Canadian corporate taxes for several years after closing. The NGL assets will be reclassified as discontinued operations as of June 30, 2025.

02—Key points

Key Highlights

  1. Sale of Plains Midstream Canada ULC, which owns substantially all of PAA's NGL business, to Keyera Corp. for approximately C$5.15 billion (about $3.75 billion USD), subject to adjustments.
  2. PAA retains substantially all U.S. NGL assets and all Canadian crude oil assets, positioning the company as a crude oil-focused midstream business.
  3. Expected net proceeds of approximately $3.0 billion USD after taxes, transaction expenses and a potential special distribution of about $0.35 per unit, subject to Board approval.
  4. Purchase price represents approximately 13x expected 2025 Distributable Cash Flow, according to the press release.
  5. Proceeds to be prioritized for bolt-on M&A, potential repurchases of Series A and Series B Preferred units, and opportunistic common unit repurchases.
  6. Estimated approximately $360 million USD of Canadian entity-level taxes, with an expected foreign tax credit to offset a significant portion of unitholders' taxable gain.
  7. Transaction expected to close in the first quarter of 2026, subject to customary conditions including regulatory approvals; NGL assets to be reclassified as discontinued operations as of June 30, 2025.

03—Questions

Frequently Asked Questions

  1. What is being sold, and to whom?

    A wholly-owned subsidiary of PAA is selling all issued and outstanding shares of Plains Midstream Canada ULC, which owns substantially all of PAA's NGL business, to Keyera Corp. for a cash purchase price of approximately C$5.15 billion, subject to adjustments.

  2. What assets does PAA keep after the sale?

    PAA will retain substantially all NGL assets located in the United States and all crude oil assets in Canada.

  3. When is the transaction expected to close, and what could affect it?

    Closing is expected in the first quarter of 2026, subject to satisfaction or waiver of customary closing conditions, including applicable regulatory approvals.

  4. How will the sale affect unitholders' taxes?

    The closing is a taxable event expected to flow taxable income through to PAA common unitholders. The filing states that a foreign tax credit from roughly $360 million USD of Canadian entity-level taxes, along with any passive activity loss carryforwards, should offset a significant portion of, and in some cases all of, the taxable gain. Holders should consult their own tax advisors.

  5. How will PAA use the proceeds?

    Expected net proceeds of approximately $3.0 billion USD will be prioritized toward disciplined bolt-on M&A, capital structure optimization including potential Series A and Series B Preferred unit repurchases, and opportunistic common unit repurchases.

04—Continue

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