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Oneok Inc. is set to enhance its energy infrastructure portfolio through two major acquisitions totaling $5.9 billion. The Tulsa-based company is acquiring Global Infrastructure Partners' (GIP) interests in both EnLink Midstream LLC for $3.3 billion and Medallion Midstream LLC for $2.6 billion. The deals will significantly boost Oneok's energy transport and storage operations in the Permian Basin and Gulf Coast.

Legal and Financial Teams on the Transactions

Kirkland & Ellis LLP is advising Oneok on both transactions. GIP is represented by Latham & Watkins LLP for the EnLink deal and by Vinson & Elkins for the Medallion acquisition. Financing for the acquisitions is being arranged by JPMorgan Chase Bank NA and Goldman Sachs Bank USA, which are committed to providing up to $6 billion.

Oneok $5.9B Energy Infrastructure Deals : Strategic Expansion in Key Markets

These acquisitions allow Oneok to gain substantial control over EnLink’s natural gas gathering and processing systems in the Gulf Coast, along with Medallion's crude oil gathering business in the Permian Basin. Oneok's CEO, Pierce H. Norton II, emphasized the importance of this strategic growth, particularly in the Permian Basin, which is expected to drive U.S. oil and gas production in the coming years.

"These transactions further solidify our position as a premier energy infrastructure company by adding complementary assets that enhance our value chain," Norton said.

Oneok $5.9B Energy Infrastructure Deals : Breakdown of the Deals

Oneok will purchase GIP's 43% stake in EnLink common units for $3 billion, or $14.90 per unit, reflecting a 12.8% premium over EnLink's recent closing price. An additional $300 million will be paid for GIP’s 100% interest in EnLink's managing member. Separately, Oneok will pay $2.6 billion for all equity interests in Medallion.

The two transactions are not cross-conditional and are expected to close in the fourth quarter of 2024, pending regulatory approvals and customary closing conditions.

Industry Impact and Financial Support

Oneok's $5.9B energy infrastructure deals underscore the company’s strategic focus on expanding its midstream operations. With more than 50,000 miles of pipeline, Oneok is a key player in gathering, processing, and transporting natural gas, crude oil, and related products. These acquisitions come a year after Oneok's $19 billion purchase of Magellan Midstream Partners.

Goldman Sachs & Co. LLC is serving as Oneok's lead financial adviser for both the EnLink and Medallion deals. Additional advisers for Oneok include J.P. Morgan Securities LLC and BofA Securities for the Medallion transaction and TPH & Co. for the EnLink deal. GIP is advised by Greenhill, Scotiabank, and RBC Capital Markets.