PSX - Phillips 66 offers to buy DCP Midstream for $34.75/unit

Phillips 66 ( NYSE: PSX ) said on Wednesday it submitted a proposal to acquire all common units of DCP Midstream ( NYSE: DCP ) it does not already own for $34.75/unit.

Phillips 66 ( PSX ) said the transaction would be structured as a merger of DCP Midstream ( DCP ) with an indirect subsidiary of Phillips 66 with DCP Midstream as the surviving entity.

The offer is part of Phillips' ( PSX ) realignment of economic and governance interests in DCP ( DCP ) and Gray Oak Pipeline through a merger of existing joint ventures owned with Enbridge.

Phillips ( PSX ) said it raised its economic interest in DCP ( DCP ) to 43.31% from 28.26% and will oversee and manage the joint venture's interest in DCP Midstream.

Meanwhile, the company's stake in Gray Oak Pipeline will drop to 6.5% from 42.25%, and Enbridge will oversee and manage the JV interest in Gray Oak; Phillips 66 ( PSX ) also will contribute $400 in cash as part of the transaction.

Phillips 66 ( PSX ) is coming off a very strong Q2, with better than expected adjusted earnings of $6.77/share .

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