Oneok gets $5.25 billion bridge loan commitment, plans to issue notes

By Sara Rosenberg

New York, May 15 – Oneok Inc. has received a commitment for a $5.25 billion unsecured 364-day bridge loan to support its acquisition of Magellan Midstream Partners LP but primarily expects to finance the transaction with a notes offering prior to close, according to filings with the Securities and Exchange Commission on Monday.

Goldman Sachs Bank USA provided the bridge commitment.

Under the agreement, Magellan is being bought for $25.00 in cash and 0.667 of a share of Oneok common stock for each outstanding Magellan common unit. The cash-and-stock transaction is valued at $18.8 billion, including assumed debt.

The combined company is expected to have strong investment-grade credit ratings and pro-forma 2024 year-end net debt-to-EBITDA of about 4x times that is anticipated to decrease to below 3.5x by 2026 as future growth projects are placed in service.

Closing is expected in the third quarter, subject to customary conditions, such as approvals by Oneok shareholders and Magellan unitholders, and Hart Scott Rodino Act clearance.

Oneok is a Tulsa, Okla.-based midstream service provider. Magellan is a Tulsa, Okla.-based publicly traded partnership that primarily transports, stores and distributes refined petroleum products and crude oil.

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