Tulsa-based ONEOK acquires Medallion, EnLink interest for $5.9 billion

• OneOK announced plans to acquire substantial interest from Global Infrastructure Partners (GIP) in a $5.9 billion transaction.

ONEOK, one of the nation's largest natural gas supply companies, is boosting its presence in the Permian Basin of Texas with plans to acquire Medallion Midstream LLC and EnLink Midstream LLC from Global Infrastructure Partners (GIP) in a $5.9 billion transaction.

The Tulsa-based energy firm announced this week it will acquire GIP’s entire interest in EnLink Midstream and all equity interests from Medallion.

The overall acquisition includes 43% of EnLink’s outstanding common units for $14.90 per unit. Out of the total $3.3 billion purchase price for the acquisition, 100% of interests amounts to $300 million. The EnLink transactions allow the company to extend its presence in North Texas and Louisiana. The company said it expects to enhance synergies, reduce leverage and increase accretion to ONEOK stakeholders.

The remaining $2.6 billion comes from the acquisition of Medallion, the largest privately held crude gathering and transporting system in the Permian’s Midland Basin. Several major players in the oil industry operate out of the Permian Basin, and the company expects the acquisition will allow it to offer new service offerings to producers in the region.

More:US pipeline operator ONEOK moves into oil, products with $18B Magellan deal

"We are particularly excited to meaningfully increase our company's presence in the Permian Basin, which is expected to continue driving the majority of U.S. oil and gas growth,” said Pierce H. Norton II, the company’s president and CEO. “ONEOK has demonstrated its ability to bring assets together and capture synergies, and we are confident that these accretive transactions will enhance value for our stakeholders and will allow us to provide enhanced offerings across multiple ONEOK platforms.”

ONEOK estimates the acquisitions will produce $250 million to $450 million in annual synergies within three years.

More:ONEOK finishes top-3 in this year's Oklahoma Inc.

ONEOK reported strong financial outcomes in the second quarter of 2024. It earned a net income of $780 million or $1.33 earnings per share within the 3-month period ending June 30 compared with $468 million or $1.18 EPS the same time last year. Total net income for 2023 resulted in $2.7 billion or $5.48 EPS.