Tulsa’s ONEOK Inc. announced late Sunday that it has agreed to acquire full ownership of Dallas-based EnLink Midstream in a $4.3 billion all-stock, tax-free transaction.
The deal, which is expected to close during the first quarter of 2025, will complete a ONEOK merger of EnLink that began earlier this year.
In August, ONEOK announced its $3.3 billion acquisition of the 43 percent of EnLink owned by Global Infrastructure Partners. That deal closed on Oct. 15. ONEOK says that it plans to vote its EnLink shares, which now represent about 44 percent of the company, in favor of the transaction. No vote of ONEOK shareholders is required to support the merger agreement.
Under the agreement, each outstanding common unit of EnLink not already owned by by ONEOK will be converted into 0.1412 shares of ONEOK common stock. The ratio represents the closing price of an EnLink unit on Nov. 22, divided by ONEOK’s 10-day volume-weighted average.
To meet the terms of the transaction, ONEOK will issue about 37 million shares representing about 6.0 percent of ONEOK shares. The deal is expected to close during the first quarter of 2025.
Kirkland & Ellis acted as outside legal counsel to ONEOK and Baker Botts is advising EnLink. Richards, Layton & Finger advised EnLink’s conflicts committee.
Goldman Sachs is lead financial advisor to ONEOK, along with Barclays and Citi. Evercore is advising EnLink. Gibson Dunn & Crutcher is, in turn, advising Evercore.
The Baker Botts team advising EnLink was led from Dallas by partners Preston Bernhisel and Sarah Dodson. The corporate lawyers included senior associate Nic O’Brien (Dallas) and associates Tala Esmaili (Dallas), Chelsea Johnson (Houston), Maddie Boezinger (Dallas), Elizabeth Kirkland (Dallas), Madeline Sparks (Dallas). Partner Luke Weedon (Dallas) weighed in on finance; partner Steve Marcus (Dallas), senior associate Andrew Maughan (Houston) advised on tax issues with partner Jason Loden (Dallas) on benefits and senior counsel Aileen Hooks (Austin) on environmental issues.
The Gibson Dunn team advising Evercore includes Hillary Holmes and Stella Tang.
The Kirkland team advising ONEOK includes Sean Wheeler, Debbie Yee and Camille Meissner; executive compensation lawyer Rob Fowler; tax lawyers David Wheat and Bill Dong; capital markets lawyer Julian Seiguer; and debt finance lawyer Rachael Lichman.
The same Kirkland team also advised ONEOK on its purchase of the GIP interest in EnLink, as well as a second concurrent $2.6 billion agreement to acquire Medallion Midstream from GIP.
Just last week ONEOK announced its sale of three midwestern pipelines to Detroit-based DT Midstream for $1.2 billion. Skadden advised ONEOK on that deal.
ONEOK CEO Pierce H. Norton II said Sunday’s acquisition of the remaining EnLink units is expected to be accretive to ONEOK shareholders while providing EnLink unitholders trading liquidity and “attractive” dividend yield.
“ONEOK has a longstanding reputation as being intentional in building a premier energy infrastructure company. This next step further solidifies that status, allowing us to continue expanding and extending our value chain, while creating value for our stakeholders,” Pierce said announcing the deal.