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In a seismic shift for the U.S. energy infrastructure, Brookfield Infrastructure Partners has announced a $9 billion deal to acquire Colonial Pipeline, the nation’s largest refined oil products pipeline system. The transaction, expected to reshape the energy transportation landscape, involves Brookfield securing 100% of Colonial Enterprises’ assets, including the 5,500-mile pipeline that stretches from Texas to New York.

A Strategic Move Backed by Legal Heavyweights

The high-profile acquisition is being guided by Kirkland & Ellis LLP, representing Brookfield, while Milbank LLP is advising the five co-owners of Colonial Enterprises—including Shell and multiple investment firms—on the sale.

Brookfield, in a Thursday announcement, highlighted the pipeline's decades-long track record of strong performance and high utilization, serving a critical customer base along the U.S. East Coast.

Breaking Down the Finances

At the time of closing, Brookfield’s equity investment is anticipated to be around $500 million, accounting for roughly 15% of the total equity—a portion that will be entirely funded through capital recycling initiatives. This places the total equity investment at over $3.3 billion.

Debt financing for the transaction is being orchestrated by Morgan Stanley Senior Funding and Mizuho Bank Ltd., with Morgan Stanley Senior Funding acting as the sole bookrunner on a term loan facility.

Shell’s Perspective: A Strategic Exit

As part of the deal, Shell and the other co-owners have agreed to transfer 100% of their Colonial shares to Brookfield.

“This divestment reflects our focus on performance, discipline, and simplification,” said Andrew Smith, president of Shell Trading and Supply, in a statement. “It will allow us to concentrate on areas where we have scale and competitive advantage.”

Colonial Pipeline’s ownership structure before the sale was divided among five key partners:

• Shell: 16.1%
• Koch Capital Investments Co.: 28%
• KKR: 23.4%
• Caisse de dépôt et placement du Québec: 16.5%
• IFM Investors: 15.8%

The Road to Completion

The transaction, which remains subject to customary closing conditions, is expected to finalize in the second half of 2025.

Financial advisory firms Jefferies LLC, Greenhill & Co., and Morgan Stanley & Co. are assisting Brookfield in navigating this major acquisition.

Legal Teams Leading the Charge

Brookfield’s legal representation from Kirkland & Ellis LLP includes powerhouse attorneys Kim Hicks, Brittany Sakowitz, Roald Nashi, Jacqueline Trudeau, Chad Smith, and Andrew DeVore.

Meanwhile, Milbank LLP, representing the sellers, has enlisted an elite team led by John Franchini and Aaron Stine, with additional partners Max Goodman, Jenna McGrath, Adam Di Vincenzo, John Beahn, Kelly Bartley, Matthew Ahrens, and Antonio Diaz-Albertini.

As the deal nears completion, all eyes remain on the regulatory landscape and its implications for the future of fuel distribution in the U.S.