- All-equity, credit-accretive bolt-on acquisition
- Complementary assets with significant integration
opportunities
- Enhances midstream infrastructure with increased
connectivity throughout Mid-Continent and U.S. Gulf Coast
- Adds investment grade credit profile and diversified asset
base anchored by strong customers and fee-based contracts
- $100 million of operational / cost synergy opportunities
expected, excluding additional upside from potential financing and
commercial synergies
Energy Transfer LP (NYSE: ET) (“ET” or “Energy Transfer”) and
Enable Midstream Partners, LP (NYSE: ENBL) (“Enable”) today
announced that they have entered into a definitive merger agreement
whereby Energy Transfer will acquire Enable in an all-equity
transaction valued at approximately $7.2 billion. Under the terms
of the agreement, Enable common unitholders will receive 0.8595 ET
common units for each Enable common unit, an exchange ratio that
represents an at-the-market transaction, based on the 10-day
volume-weighted average price of ET and Enable common units on
February 12, 2021. In addition, each outstanding Enable Series A
preferred unit will be exchanged for 0.0265 Series G preferred
units of Energy Transfer. The transaction will include a $10
million cash payment for Enable’s general partner.
This press release features multimedia. View
the full release here:
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Complementary Asset Base Drives Value
Across Footprint – Creates Contiguous Asset Footprint (Graphic:
Business Wire)
Positive Financial Impact
The transaction furthers Energy Transfer’s deleveraging efforts
as it is expected to be immediately accretive to free cash flow
post-distributions, have a positive impact on credit metrics and
add significant fee-based cash flows from fixed-fee contracts.
The all-equity nature of the transaction allows unitholders of
both partnerships to participate in the value creation potential of
the combined partnership.
Complementary Assets
Energy Transfer’s acquisition of Enable will increase Energy
Transfer’s footprint across multiple regions and provide increased
connectivity for Energy Transfer’s natural gas and NGL
transportation businesses.
Energy Transfer will significantly strengthen its NGL
infrastructure by adding natural gas gathering and processing
assets in the Anadarko Basin in Oklahoma and integrate high-quality
assets with Energy Transfer’s existing NGL transportation and
fractionation assets on the U.S. Gulf Coast. The acquisition will
also provide significant gas gathering and processing assets in the
Arkoma basin across Oklahoma and Arkansas, as well as the
Haynesville Shale in East Texas and North Louisiana.
Enable’s transportation and storage assets enhance Energy
Transfer’s access to core markets with consistent sources of demand
and bolster its portfolio of customers anchored by large,
investment-grade customers with firm, long-term contracts. Energy
Transfer will further enhance its connectivity to the global LNG
market and the growing global demand for natural gas as the world
transitions to cleaner power and fuel sources.
Synergies
The combination of Energy Transfer’s significant infrastructure
with Enable’s complementary assets will allow the combined company
to pursue additional commercial opportunities and achieve cost
savings while enhancing Energy Transfer’s ability to serve
customers.
Energy Transfer expects the combined company to generate more
than $100 million of annual run-rate cost and efficiency synergies,
excluding potential financial and commercial synergies. Potential
commercial synergies include significant incremental earnings,
which may result from integrating Enable’s Anadarko gathering and
processing complex with Energy Transfer’s fractionation assets on
the U.S. Gulf Coast.
Timing and Conference Call Information
The transaction has been approved by the Board of Directors of
ET and the Conflicts Committee and the Board of Directors of
Enable. The two largest unitholders of Enable, OGE Energy Corp.
(“OG&E”) and CenterPoint Energy, Inc. (“CNP”), which also
control the General Partner of Enable, have entered into support
agreements, pursuant to which they have agreed to vote their Enable
units in favor of the merger, upon effectiveness of the S-4
Registration Statement with the SEC. These two unitholders own
approximately 79.2% of Enable’s outstanding common units. The
transaction is expected to close in mid-2021 and is subject to the
satisfaction of customary closing conditions, including Hart Scott
Rodino Act clearance. Upon closing, Enable unitholders are expected
to own approximately 12 percent of Energy Transfer’s outstanding
common units.
Energy Transfer will host a conference call February 17 at 4:00
p.m. Central Time / 5:00 p.m. Eastern Time to discuss this
transaction along with its fourth quarter and full-year 2020
results. The conference call will be broadcast live via a webcast,
which can be accessed through https://www.energytransfer.com/.
Advisors
Citi and RBC Capital Markets acted as financial advisors to
Energy Transfer and Latham & Watkins LLP acted as legal
counsel. Goldman Sachs & Co. LLC acted as financial advisor to
Enable and Vinson & Elkins LLP acted as legal counsel. Intrepid
Partners, LLC acted as financial advisor and Richards, Layton &
Finger, PA acted as legal counsel to Enable’s conflicts
committee.
About Energy Transfer
Energy Transfer LP (NYSE: ET) owns and operates one of the
largest and most diversified portfolios of energy assets in the
United States, with a strategic footprint in all of the major
domestic production basins. ET is a publicly traded limited
partnership with core operations that include complementary natural
gas midstream, intrastate and interstate transportation and storage
assets; crude oil, NGL and refined product transportation and
terminalling assets; NGL fractionation; and various acquisition and
marketing assets. ET, through its ownership of Energy Transfer
Operating, L.P., also owns Lake Charles LNG Company, as well as the
general partner interests, the incentive distribution rights and
28.5 million common units of Sunoco LP (NYSE: SUN), and the general
partner interests and 46.1 million common units of USA Compression
Partners, LP (NYSE: USAC). For more information, visit the Energy
Transfer LP website at https://www.energytransfer.com/.
About Enable
Enable (NYSE: ENBL) owns, operates and develops strategically
located natural gas and crude oil infrastructure assets. Enable’s
assets include approximately 14,000 miles of natural gas, crude
oil, condensate and produced water gathering pipelines,
approximately 2.6 Bcf/d of natural gas processing capacity,
approximately 7,800 miles of interstate pipelines (including
Southeast Supply Header, LLC of which Enable owns 50%),
approximately 2,200 miles of intrastate pipelines and seven natural
gas storage facilities comprising 84.5 billion cubic feet of
storage capacity. For more information, visit
https://www.enablemidstream.com/.
Forward-Looking Statements
This release includes “forward-looking” statements.
Forward-looking statements are identified as any statement that
does not relate strictly to historical or current facts. Statements
using words such as “anticipate,” “believe,” “intend,” “project,”
“plan,” “expect,” “continue,” “estimate,” “goal,” “forecast,” “may”
or similar expressions help identify forward-looking statements.
Energy Transfer and Enable cannot give any assurance that
expectations and projections about future events will prove to be
correct. Forward-looking statements are subject to a variety of
risks, uncertainties and assumptions. These risks and uncertainties
include the risks that the proposed transaction may not be
consummated or the benefits contemplated therefrom may not be
realized. Additional risks include: the ability to obtain requisite
regulatory and stockholder approval and the satisfaction of the
other conditions to the consummation of the proposed transaction,
the ability of Energy Transfer to successfully integrate Enable’s
operations and employees and realize anticipated synergies and cost
savings, the potential impact of the announcement or consummation
of the proposed transaction on relationships, including with
employees, suppliers, customers, competitors and credit rating
agencies, the ability to achieve revenue, DCF and EBITDA growth,
and volatility in the price of oil, natural gas, and natural gas
liquids. Actual results and outcomes may differ materially from
those expressed in such forward-looking statements. These and other
risks and uncertainties are discussed in more detail in filings
made by Energy Transfer and Enable with the SEC, which are
available to the public. Energy Transfer and Enable undertake no
obligation to update publicly or to revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
Additional Information and Where to Find It
SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT
AND PROXY STATEMENT/PROSPECTUS REGARDING THE TRANSACTION CAREFULLY
WHEN IT BECOMES AVAILABLE. These documents (when they become
available), and any other documents filed by Energy Transfer and
Enable with the SEC, may be obtained free of charge at the SEC’s
website, at https://www.sec.gov/. In addition, investors and
security holders will be able to obtain free copies of the
registration statement and the proxy statement/prospectus by phone,
e-mail or written request by contacting the investor relations
department of Energy Transfer at the number and address set forth
below:
Energy Transfer LP 8111 Westchester Drive, Suite 600 Dallas,
Texas 75225
Enable Midstream Partners LP 499 W. Sheridan Ave., Suite 1500
Oklahoma City, OK 73102
No offer or solicitation
This communication relates to a proposed merger (the “Merger”)
between Enable and Energy Transfer. This communication is for
informational purposes only and does not constitute an offer to
sell or the solicitation of an offer to buy any securities or a
solicitation of any vote or approval, in any jurisdiction, pursuant
to the Merger or otherwise, nor shall there be any sale, issuance,
exchange or transfer of the securities referred to in this document
in any jurisdiction in contravention of applicable law. No offer of
securities shall be made except by means of a prospectus meeting
the requirements of Section 10 of the Securities Act of 1933, as
amended.
Participants in the Solicitation
Enable, Energy Transfer, and the directors and executive
officers of their respective general partners, CNP (and their
affiliates), OGE (and their affiliates) may be deemed to be
participants in the solicitation of proxies in respect to the
Merger.
Information regarding the directors and executive officers of
Enable’s general partner is contained in Enable’s 2019 Annual
Report on Form 10-K filed with the SEC on February 19, 2020, and
certain of its Quarterly Reports on Form 10-Q Current Reports on
Form 8-K. You can obtain a free copy of this document at the SEC’s
website at http://www.sec.gov or by accessing Enable’s website at
http://www.enablemidstream.com. Information regarding the executive
officers and directors of Energy Transfer’s general partner is
contained in Energy Transfer’s 2019 Annual Report on Form 10-K
filed with the SEC on February 21, 2020 and certain of its Current
Reports on Form 8-K. You can obtain a free copy of this document at
the SEC’s website at www.sec.gov or by accessing Energy Transfer’s
website at http://www.energytransfer.com.
Investors may obtain additional information regarding the
interests of those persons and other persons who may be deemed
participants in the Merger by reading the consent solicitation
statement/prospectus regarding the Merger when it becomes
available. You may obtain free copies of this document as described
above.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210217005332/en/
Energy Transfer LP Investors Bill Baerg, Brent Ratliff,
Lyndsay Hannah (214) 981-0795
investorrelations@energytransfer.com
Media Vicki Granado, Lisa Coleman (214) 840-5820
media@energytransfer.com
Enable Midstream Partners Investors Matt Beasley (405)
558-4600
Media Leigh Ann Williams (405) 553-6947
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