OKE - Magellan Midstream CEO says confident sale to Oneok will prevail

2023-07-25 11:55:49 ET

Magellan Midstream Partners ( NYSE: MMP ) CEO Aaron Milford said Tuesday he is confident the planned sale to Oneok ( NYSE: OKE ) ultimately will win approval from its unitholders despite opposition.

Energy Income Partners, Magellan's ( MMP ) fourth largest unitholder with a 3.1% stake, has said it will vote against the proposed deal , saying holders would end up ~10% worse off from the merger because the up-front tax payment and loss of after-tax dividend income would exceed the merger premium by $7/unit.

Milford believes the financial benefits to Magellan ( MMP ) investors will outweigh the tax bills, telling Reuters in an interview that the partnership will "get the vote, as the value proposition is too compelling."

Milford also pointed out the benefits from the combined company's increased scale, product diversification and annual cost savings of as much as $400M.

Magellan ( MMP ) published a report from tax specialist Robert Willens it said validates the partnership's view that the pending Oneok ( OKE ) merger maximizes value and is in the best interest of unitholders.

More on proposed Magellan-Oneok merger:

• Oneok Is A Buy With Or Without Magellan Midstream
• Magellan Midstream: Long-Term Investors Should Reject Oneok Deal
• Oneok And Magellan May Be Stronger Together But Face Opposition From Unitholders

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