EnLink Midstream, LLC (NYSE:ENLC) shares traded higher premarket on Monday after it disclosed a merger deal with ONEOK, Inc. (NYSE:OKE) for $4.3 billion.
As per the deal, each EnLink common unit not owned by ONEOK will be exchanged for 0.1412 shares of ONEOK stock.
This exchange ratio reflects EnLink's closing price of $15.75 on November 22, 2024, divided by ONEOK's 10-day volume-weighted average price (VWAP).
ONEOK will issue approximately 37 million shares, representing about 6% of its total shares outstanding after the transaction.
ONEOK, which holds approximately 44% of EnLink's common units, has committed to voting in favor of the transaction.
The transaction, subject to customary closing conditions, is expected to close in the first quarter of 2025.
The merger's completion requires approval from a majority of EnLink's outstanding common units, including those owned by ONEOK, and satisfaction of other customary closing conditions.
Pierce H. Norton II, ONEOK president and chief executive officer, said, "This tax-free transaction to acquire the remaining outstanding EnLink units is expected to be accretive to ONEOK shareholders and provide EnLink unitholders with significantly greater trading liquidity and an attractive dividend yield."
In October 15, 2024, ONEOK disclosed the successful completion of its acquisition of Global Infrastructure Partners' (GIP) entire interest in EnLink for a total cash consideration of approximately $3.3 billion.
Investors can gain exposure to the OKE stock via Global X MLP & Energy Infrastructure ETF (NYSE:MLPX) and Tortoise North American Pipeline ETF (NYSE:TPYP).
Price Action: ENLC shares are up 1.27% at $15.95 premarket at the last check Monday.
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