Phillips 66 said on Friday it acquired all publicly held units of DCP Midstream LP in a sweetened deal that values the pipeline operator at about $8.7 billion and will help bulk up the U.S. refiner's natural gas liquids business.
in a sweetened deal that values the pipeline operator at about $8.7 billion and will help bulk up the U.S. refiner's natural gas liquids business.
The deal, the first major move by Mark Lashier who took over as chief executive of Phillips 66 in July last year, will double the company's stake in DCP Midstream to 86.8%.on new projects by about 6% in 2023, with a focus on bolstering its pipeline businesses. The Houston, Texas-based refiner is buying the public units for $3.8 billion, or $41.75 per share, compared with its previous offer of $34.75 per share. DCP Midstream's shares rose nearly 6.4% to $41.84, while those of Phillips 66 were up 1.1%.
The DCP deal is expected to generate an incremental $1 billion of adjusted EBITDA for Phillips 66, the refiner said in a statement. Phillips said it expects to save at least $300 million by integrating DCP into its existing midstream business.The all-cash deal, which has been approved by Phillips as DCP's majority unit owner, is expected to close in the second quarter of 2023.Canadian pipeline operator EnbridgeReporting by Arshreet Singh; Editing by Shinjini Ganguli and Saumyadeb Chakrabarty
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