Oneok to Buy Magellan Midstream for $14 Billion, Creating U.S. Energy Giant

Oneok, a large U.S. energy company, announced on Sunday that it would buy Magellan Midstream Partners, a smaller rival that owns pipelines and storage facilities for refined products, for $14 billion. The deal, which includes cash and equity, would create one of the biggest U.S. energy transporters and storers, with a combined market value of nearly $40 billion. Oneok said the deal would boost its cash flow and allow it to expand into green energy businesses in the future. Oneok Chief Executive Pierce Norton said the tie-up would “present further opportunities in our core businesses as well as enhance our ability to participate in the ongoing energy transformation.” Magellan’s CEO Michael Mears said the deal would “provide Magellan’s unitholders with an attractive premium and an opportunity to participate in the future growth of a stronger combined company.”

Pipeline operator Oneok agreed Sunday to buy smaller rival Magellan Midstream Partners for about $14 billion, a deal that would form one of the biggest U.S. companies involved in transporting and storing energy.

The deal’s price tag, including $8.8 billion in equity and $5.1 billion in cash, amounted to a 22% premium over Magellan’s common units as of Friday. Oneok said it would assume Magellan’s $5 billion in net debt. The deal was expected to close in the third quarter, pending the approval of regulators and investors.

$14 Billion Deal to Create Mega-Pipeline Company – WSJ