Energy infrastructure company Oneok Inc. will buy Magellan Midstream Partners L.P. in a cash-and-stock transaction valued at around $18.8 billion including assumed debt, according to a joint statement.
Each Magellan unit holder will receive $25 in cash and 0.6670 shares of Oneok stock per unit, representing a 22% premium to the Magellan closing price on May 12.
The deal will result in a combined company with a total enterprise value of $60 billion, the statement said.
Oneok expects the transaction to be earnings per share (EPS) accretive from 2024 with an EPS accretion of 3% to 7% per year from 2025 through 2027, and free cash flow per share accretion averaging more than 20% from 2024 through 2027.
The transaction is expected to close in the third quarter this year, subject to shareholders and regulatory approvals. Oneok has secured $5.25 billion in fully committed bridge financing for the proposed cash consideration.
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