Energy Transfer LP agreed on Sept. 16 to acquire SemGroup Corp. in a multibillion-dollar acquisition that analysts claim “flies in the face” of recent messaging from the Dallas-based midstream company.

In a release, Energy Transfer said it offered a sizable premium to acquire the Tulsa, Okla.-based company in a $5.1 billion cash and stock deal that includes the assumption of $5 billion of debt. According to the company release, the transaction values SemGroup at $17 per share, representing a 65% premium to its closing share price on Sept. 13.

Though both companies justified the transaction with over $170 million of expected annual synergies, analysts with Tudor, Pickering, Holt & Co. (TPH) called the SempGroup acquisition a setback for Energy Transfer.

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