ONEOK Inc. has priced an offering to sell $7 billion senior notes of varying durations and terms, according to a Sept. 10 press release.

ONEOK expects net proceeds from the offer of approximately $6.92 billion. The company intends to use the proceeds to fund its previously announced acquisition of Global Infrastructure Partners’ interest in midstream companies EnLink and Medallion.

ONEOK announced an overall $5.9 billion deal for a controlling interest in EnLink Midstream and Medallion Midstream on Aug. 28. The deal would give ONEOK a fully integrated Permian Basin platform that will secure traffic on its pipelines out of the country’s most productive play.

ONEOK is offering three-, five- and seven-year notes, which would be subject to a "special mandatory redemption" if the EnLink transaction is not completed by Aug. 28, 2025.

If the EnLink purchase agreement is terminated or ONEOK otherwise notifies the trustee in writing that it will not pursue the consummation of the EnLink deal, then the three-, five- and seven-year notes could also face a mandatory redemption.

Any remaining net proceeds from the offering will be used for general corporate purposes, which may include outstanding debt repayment, including the repurchase or redemption of existing notes, ONEOK said.

The offer is set to close by Sept. 24, subject to the satisfaction of customary closing conditions.

The notes consist of:

  • $1.25 billion of three-year senior notes at a coupon of 4.25%;
  • $600 million of five-year senior notes at a coupon of 4.40%;
  • $1.25 billion of seven-year senior notes at a coupon of 4.75%;
  • $1.60 billion of 10-year senior notes at a coupon of 5.05%;
  • $1.50 billion of 30-year senior notes at a coupon of 5.70%; and
  • $800 million of 40-year senior notes at a coupon of 5.85%.

J.P. Morgan Securities, Goldman Sachs & Co., Barclays Capital, BofA Securities, Wells Fargo Securities, Citigroup Global Markets, Mizuho Securities USA, MUFG Securities Americas, Scotia Capital (USA), TD Securities (USA) and Siebert Williams Shank & Co. are acting as joint book-running managers for the offering.

CIBC World Markets, Deutsche Bank Securities, PNC Capital Markets, RBC Capital Markets, Regions Securities, SMBC Nikko Securities America, Truist Securities, U.S. Bancorp Investments, Academy Securities, BOK Financial Securities, Loop Capital Markets LLC and R. Seelaus & Co. are acting as co-managers for the offering.

Comments