American midstream service provider ONEOK has wrapped up the previously announced $18.8bn cash-and-stock acquisition of Magellan Midstream Partners.
Prior to the deal announced in May 2023, Magellan Midstream Partners was a publicly traded partnership listed on the New York Stock Exchange (NYSE).
The closing of the deal follows last week’s approval by ONEOK shareholders and Magellan unitholders.
As per the terms of the deal, Magellan Midstream Partners’ unitholders were paid $25 in cash and issued 0.667 shares of ONEOK common stock for exchanging each of their shares in the former.
Magellan Midstream Partners’ common units will not be traded publicly on the NYSE. Instead, shares of ONEOK’s common stock will continue trading on the same stock exchange.
According to ONEOK, the acquisition enables it to form a more varied North American midstream infrastructure firm. The enlarged company will be involved in supplying crucial energy products and services to its customers while delivering robust returns for investors.
ONEOK president and CEO Pierce Norton II said: “This is a significant day for Tulsa and the industry as we bring together the talented ONEOK and Magellan teams and look to the future as one company.
“Our expanded products platform will present additional opportunities in ONEOK’s core businesses and further enhance the resiliency of our company. We are committed to ensuring a smooth transition aimed at delivering on the many benefits of this combination for our customers, employees and shareholders.”
ONEOK owns natural gas liquids (NGL) systems, that link NGL supply in the Rocky Mountain, Permian, and Mid-Continent areas with important market hubs. The midstream service provider also owns a network of gathering, processing, fractionation, transportation, and storage facilities.
On the other hand, Magellan Midstream Partners is mainly into transportation, storage, and distribution of refined petroleum products as well as crude oil.
It is claimed to own the longest refined petroleum products pipeline system in the US, with access to around 50% of the country’s refining capacity. Magellan Midstream Partners brings to ONEOK a storage capacity in excess of 100 million barrels of petroleum products, including gasoline, crude oil, and diesel fuel.
