Energy Transfer Announces Secondary Public Offering of Common Units

Rhea-AI Summary

Energy Transfer LP (NYSE: ET) has announced a secondary public offering of 38,755,996 common units by WTG Midstream and a Stonepeak affiliate. The Selling Unitholders will receive all proceeds from the offering, with Energy Transfer not selling any units or receiving any proceeds. Barclays is serving as the underwriter for this market-dependent offering. The offering is made under a previously filed registration statement that became effective on July 31, 2024. Interested parties can obtain the prospectus from Barclays Capital Inc. or the SEC's website. This announcement does not constitute an offer to sell or a solicitation to buy securities.

Positive

• Potential for increased liquidity in Energy Transfer's common units
• No dilution for existing unitholders as Energy Transfer is not issuing new units

Negative

• Large volume of units being sold may put downward pressure on unit price
• Selling Unitholders reducing their stake could be perceived negatively by the market

Insights

Financial Analyst

This secondary offering of 38,755,996 common units by the Selling Unitholders is a neutral event for Energy Transfer LP. While it doesn't directly impact the company's financials, it could affect market dynamics:

• No dilution for existing unitholders as Energy Transfer isn't issuing new units.
• The company won't receive any proceeds, limiting potential for immediate strategic investments.
• Large volume may cause short-term price pressure, but also increases liquidity.
• Stonepeak's partial exit might signal their view on ET's future prospects or portfolio rebalancing.

Investors should monitor post-offering price action and any shifts in institutional ownership patterns. The offering's success could indicate market sentiment towards ET's current valuation and growth prospects.

Market Research Analyst

This secondary offering presents interesting market dynamics for Energy Transfer:

• Timing suggests Selling Unitholders see current market conditions as favorable for exit.
• Large block (38.7 million units) may temporarily increase supply, potentially pressuring price.
• Broadened investor base could enhance long-term trading liquidity.
• Market reaction will indicate investor confidence in ET's fundamentals and growth strategy.

Retail investors should watch for any significant volume spikes or price volatility following the offering. If the units are absorbed without major price impact, it could signal strong underlying demand and positive sentiment towards ET's future prospects in the midstream energy sector.

Selling Unitholders Will Receive All Proceeds of Offering

DALLAS--(BUSINESS WIRE)-- Energy Transfer LP (“Energy Transfer” or the “Partnership”) (NYSE: ET) today announced the commencement of an underwritten secondary public offering of an aggregate of 38,755,996 of its common units representing limited partner interests (the “common units”), by WTG Midstream LLC and an affiliate of Stonepeak (the “Selling Unitholders”). The Selling Unitholders will receive all proceeds from the offering.

Energy Transfer will not sell any common units in the offering and will not receive any proceeds therefrom.

Barclays is serving as the underwriter for the offering. The offering is subject to market and other conditions, and there can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering.

The proposed offering will be made pursuant to a registration statement previously filed by the Partnership with the U.S. Securities and Exchange Commission (the “SEC”) that was declared effective on July 31, 2024.

The proposed offering will be made only by means of a prospectus and prospectus supplement that meet the requirements under the Securities Act of 1933, as amended (the “Securities Act”). Copies of the preliminary prospectus supplement and accompanying base prospectus and final prospectus supplement, when available, may be obtained from: Barclays Capital Inc., c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, or by email at Barclaysprospectus@broadridge.com; or by accessing the SEC’s website at www.sec.gov.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy common units or any other securities, nor shall there be any sale of securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful without registration or qualification under the securities laws of any such state or jurisdiction.

About Energy Transfer

Energy Transfer LP (NYSE: ET) owns and operates one of the largest and most diversified portfolios of energy assets in the United States, with more than 130,000 miles of pipeline and associated energy infrastructure. Energy Transfer’s strategic network spans 44 states with assets in all of the major U.S. production basins. Energy Transfer is a publicly traded limited partnership with core operations that include complementary natural gas midstream, intrastate and interstate transportation and storage assets; crude oil, natural gas liquids (“NGL”) and refined product transportation and terminalling assets; and NGL fractionation. Energy Transfer also owns Lake Charles LNG Company, as well as the general partner interests, the incentive distribution rights and approximately 21% of the outstanding common units of Sunoco LP (NYSE: SUN), and the general partner interests and approximately 39% of the outstanding common units of USA Compression Partners, LP (NYSE: USAC).

Forward-Looking Statements

This news release may include certain statements concerning expectations for the future that are forward-looking statements as defined by federal law. In some cases, forward-looking statements can be identified by words such as “anticipates,” “believes,” “intends,” “projects,” “plans,” “expects,” “continues,” “estimates,” “goals,” “forecasts,” “may,” “will” and other similar expressions. Each forward-looking statement made by us is based only on information currently available to us and speaks only as of the date on which it is made. Such forward-looking statements are subject to a variety of known and unknown risks, uncertainties, and other factors that are difficult to predict, many of which are beyond management’s control. You should not place undue reliance on forward-looking statements. An extensive list of factors that may affect future results, including future distribution levels, are discussed in the Partnership’s Annual Report on Form 10-K and other documents filed from time to time with the Securities and Exchange Commission. The Partnership undertakes no obligation to update or revise any forward-looking statement to reflect new information or events.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240809966233/en/

Investor Relations:

Bill Baerg

Brent Ratliff

Lyndsay Hannah

214-981-0795



Media Relations:

Vicki Granado

214-840-5820

Source: Energy Transfer LP

FAQ

How many common units of Energy Transfer (ET) are being offered in the secondary public offering?

The secondary public offering involves 38,755,996 common units of Energy Transfer (ET).

Who are the Selling Unitholders in Energy Transfer's (ET) secondary offering?

The Selling Unitholders are WTG Midstream and an affiliate of Stonepeak.

Will Energy Transfer (ET) receive any proceeds from this secondary offering?

No, Energy Transfer (ET) will not receive any proceeds from this secondary offering. All proceeds will go to the Selling Unitholders.

When did the registration statement for Energy Transfer's (ET) offering become effective?

The registration statement for Energy Transfer's (ET) offering became effective on July 31, 2024.