8-KAcquisitions & DispositionsOther EventsExhibits & Filings

Targa Resources Corp. 8-K Report, Acquisition Completed (Feb 19, 2016)

Filed February 19, 2016For Securities:TRGP

Summary

Targa Resources Corp. (TRC) announced on February 19, 2016, the completion of its previously announced merger with Targa Resources Partners LP (the Partnership). This transaction, effective February 17, 2016, involved Merger Sub, a wholly-owned subsidiary of TRC, merging with and into the Partnership. As a result, TRC indirectly acquired all outstanding common units of the Partnership that TRC and its subsidiaries did not already own. The terms of the merger stipulated that for each common unit of the Partnership not held by TRC or its affiliates, holders would receive 0.62 shares of TRC common stock. This move consolidates the structure of Targa Resources, simplifying its operations and potentially enhancing its financial flexibility. The company also addressed the treatment of executive compensation awards, converting performance unit awards to equivalent awards based on TRC shares, while retaining vesting provisions and eliminating performance factors tied to the Partnership's units.

Key Highlights

  • 1Completion of the merger between Targa Resources Corp. (TRC) and Targa Resources Partners LP (Partnership) on February 17, 2016.
  • 2TRC effectively acquired all outstanding common units of the Partnership not already owned by TRC and its subsidiaries.
  • 3Each remaining common unit of the Partnership was converted into 0.62 shares of TRC common stock.
  • 4The merger simplifies TRC's corporate structure by eliminating the master limited partnership (MLP) structure for publicly held units.
  • 5Executive performance unit awards were converted to TRC share-based awards, with adjusted vesting and performance criteria.
  • 6No fractional TRC shares were issued; cash was provided in lieu of fractional shares.
  • 7The company issued a press release on February 17, 2016, to announce the transaction's completion.

Frequently Asked Questions

The main event reported is the completion of the merger between Targa Resources Corp. (TRC) and Targa Resources Partners LP (Partnership) on February 17, 2016. TRC acquired all common units of the Partnership it did not already own.

Unitholders of Targa Resources Partners LP whose units were not owned by TRC or its subsidiaries received 0.62 shares of Targa Resources Corp. common stock for each common unit they held. Cash was paid in lieu of any fractional shares.

The merger effectively consolidates TRC's ownership of the Partnership's common units, simplifying its corporate structure by moving towards a single-tier C-corp structure for the publicly traded equity, eliminating the need for separate partnership common units.

Outstanding and unvested performance unit awards held by named executive officers were converted into comparable awards for TRC shares. These new awards retain the original time-based vesting and forfeiture provisions but have the performance factor removed.