Plains All American Announces Bolt-on Acquisitions, Capital Structure Optimization & Distribution Increase
Plains All American Pipeline (PAA) has announced three strategic bolt-on acquisitions totaling approximately $670 million, along with significant capital structure optimization initiatives. The company is acquiring Ironwood Midstream Energy for $475 million, expanding its Eagle Ford Basin presence. Through its joint venture, it acquired Medallion Midstream's Delaware Basin crude oil gathering business for $160 million ($105 million net to PAA), and purchased the remaining 50% stake in Midway Pipeline for $90 million.
Additionally, PAA will purchase about 12.7 million units (18%) of its outstanding Series A Preferred Units at $26.25 per unit, totaling approximately $330 million. The company also announced a 20% increase in its quarterly distribution from $0.3175 to $0.38 per unit. Post-transactions, PAA's leverage ratio is expected to remain at or below their target range of 3.25x to 3.75x.
Plains All American Pipeline (PAA) ha annunciato tre acquisizioni strategiche che ammontano a circa $670 milioni, insieme a significative iniziative di ottimizzazione della struttura del capitale. L'azienda sta acquisendo Ironwood Midstream Energy per $475 milioni, espandendo la sua presenza nel bacino di Eagle Ford. Attraverso la sua joint venture, ha acquisito il business di raccolta di petrolio greggio di Medallion Midstream nel bacino del Delaware per $160 milioni (di cui $105 milioni netti per PAA), e ha acquistato la restante partecipazione del 50% in Midway Pipeline per $90 milioni.
Inoltre, PAA acquisterà circa 12,7 milioni di unità (18%) delle sue unità privilegiate di Serie A in circolazione a $26,25 per unità, per un totale di circa $330 milioni. L'azienda ha anche annunciato un aumento del 20% della distribuzione trimestrale, passando da $0,3175 a $0,38 per unità. Dopo le transazioni, il rapporto di indebitamento di PAA è previsto rimanere al di sotto o pari al loro intervallo target di 3,25x a 3,75x.
Plains All American Pipeline (PAA) ha anunciado tres adquisiciones estratégicas que suman aproximadamente $670 millones, junto con importantes iniciativas de optimización de la estructura de capital. La compañía está adquiriendo Ironwood Midstream Energy por $475 millones, ampliando su presencia en la cuenca de Eagle Ford. A través de su empresa conjunta, adquirió el negocio de recolección de petróleo crudo de Medallion Midstream en la cuenca de Delaware por $160 millones (de los cuales $105 millones son netos para PAA), y compró el 50% restante de Midway Pipeline por $90 millones.
Además, PAA comprará aproximadamente 12.7 millones de unidades (18%) de sus Unidades Preferidas de Serie A en circulación a $26.25 por unidad, totalizando aproximadamente $330 millones. La compañía también anunció un aumento del 20% en su distribución trimestral, de $0.3175 a $0.38 por unidad. Después de las transacciones, se espera que la ratio de apalancamiento de PAA se mantenga en o por debajo de su rango objetivo de 3.25x a 3.75x.
플레인스 올 아메리칸 파이프라인(PAA)은 약 6억 7천만 달러에 달하는 세 가지 전략적 인수와 함께 자본 구조 최적화 이니셔티브를 발표했습니다. 이 회사는 아이언우드 미드스트림 에너지를 4억 7천 5백만 달러에 인수하여 이글 포드 분지에서의 입지를 확대하고 있습니다. 합작 투자를 통해 메달리온 미드스트림 델라웨어 분지의 원유 수집 사업을 1억 6천만 달러(순 PAA 1억 5백만 달러)에 인수했으며, 미드웨이 파이프라인의 나머지 50% 지분을 9천만 달러에 구매했습니다.
또한 PAA는 약 1천270만 유닛(18%)의 유통 중인 A 시리즈 우선주를 유닛당 26.25달러에 구매하여 총 약 3억 3천만 달러에 달합니다. 이 회사는 분기 배당금을 유닛당 $0.3175에서 $0.38로 20% 인상한다고 발표했습니다. 거래 후 PAA의 부채 비율은 목표 범위인 3.25배에서 3.75배 이하에 유지될 것으로 예상됩니다.
Plains All American Pipeline (PAA) a annoncé trois acquisitions stratégiques totalisant environ 670 millions de dollars, ainsi que des initiatives significatives d'optimisation de la structure du capital. La société acquiert Ironwood Midstream Energy pour 475 millions de dollars, renforçant sa présence dans le bassin d'Eagle Ford. Grâce à sa coentreprise, elle a acquis l'activité de collecte de pétrole brut de Medallion Midstream dans le bassin du Delaware pour 160 millions de dollars (105 millions de dollars nets pour PAA), et a acheté le reste des 50 % de Midway Pipeline pour 90 millions de dollars.
De plus, PAA achètera environ 12,7 millions d'unités (18 %) de ses unités préférentielles de série A en circulation à 26,25 $ par unité, pour un total d'environ 330 millions de dollars. La société a également annoncé une augmentation de 20 % de sa distribution trimestrielle, passant de 0,3175 $ à 0,38 $ par unité. Après les transactions, le ratio d'endettement de PAA devrait rester dans ou en dessous de sa fourchette cible de 3,25x à 3,75x.
Plains All American Pipeline (PAA) hat drei strategische Akquisitionen im Gesamtwert von etwa 670 Millionen Dollar bekannt gegeben, zusammen mit bedeutenden Initiativen zur Optimierung der Kapitalstruktur. Das Unternehmen erwirbt Ironwood Midstream Energy für 475 Millionen Dollar und erweitert damit seine Präsenz im Eagle Ford Basin. Durch sein Joint Venture hat es das Rohöl-Sammelgeschäft von Medallion Midstream im Delaware Basin für 160 Millionen Dollar (105 Millionen Dollar netto für PAA) übernommen und den verbleibenden 50%-Anteil an Midway Pipeline für 90 Millionen Dollar erworben.
Zusätzlich wird PAA etwa 12,7 Millionen Einheiten (18%) seiner ausstehenden Serien-A-Vorzugsanteile zu einem Preis von 26,25 Dollar pro Einheit erwerben, was insgesamt etwa 330 Millionen Dollar beträgt. Das Unternehmen gab auch eine Erhöhung der vierteljährlichen Ausschüttung um 20% von 0,3175 auf 0,38 Dollar pro Einheit bekannt. Nach den Transaktionen wird das Verschuldungsverhältnis von PAA voraussichtlich im Rahmen des Zielbereichs von 3,25x bis 3,75x bleiben.
- Three strategic acquisitions expanding presence in key basins for $670 million
- 20% increase in quarterly distribution to $0.38 per unit
- Leverage ratio expected to remain at or below target range (3.25x-3.75x)
- Immediate value creation through earnings and distributable cash flow accretion
- Significant cash outlay of $1 billion combined for acquisitions and preferred units buyback
Insights
HOUSTON, Jan. 07, 2025 (GLOBE NEWSWIRE) -- Plains All American Pipeline, L.P. (Nasdaq: PAA) and Plains GP Holdings (Nasdaq: PAGP) (collectively, “Plains”) announced today three bolt-on acquisitions for an aggregate cash consideration of approximately
Bolt-on Acquisitions
- Plains signed a definitive agreement to acquire Ironwood Midstream Energy, which owns an Eagle Ford Basin gathering system, from EnCap Flatrock Midstream for approximately
$475 million . The transaction is expected to close in the first quarter of 2025 following satisfaction of customary closing conditions. - Effective January 1, 2025, a subsidiary of Plains Permian Basin joint venture, Plains Oryx Permian Basin LLC, acquired Medallion Midstream’s Delaware Basin crude oil gathering business from The Energy & Minerals Group for approximately
$160 million ($105 million net to PAA’s interest). - On December 23, 2024, a subsidiary of Plains acquired the remaining
50% interest in Midway Pipeline LLC from a subsidiary of CVR Energy for approximately$90 million . - These transactions further enhance Plains’ crude oil footprint in the Permian, Eagle Ford and Mid-Con at returns consistent with our bolt-on framework and provide incremental return of capital opportunities for our unitholders.
Capital Structure Optimization
- Plains has also agreed to purchase approximately 12.7 million units, or
18% , of its outstanding Series A Preferred Units at “par” ($26.25) for a purchase price of approximately$330 million (plus accrued and unpaid distributions) from EnCap Flatrock Midstream. This transaction is expected to close in late January 2025. - After giving effect to all of these transactions, Plains' leverage ratio is expected to be at or below the low-end of our target range of 3.25x to 3.75x, continuing to provide significant balance sheet optionality and flexibility.
Return of Capital Update
- The Plains Board of Directors has approved an increase in the quarterly distribution payable in February 2025 for both PAA common units and PAGP Class A shares from
$0.31 75 per unit to$0.38 per unit. On an annualized basis, the distribution represents a$0.25 per unit, or20% , increase from the distribution paid in November 2024.
“The bolt-on acquisitions announced today are an excellent strategic fit for Plains and allow us to progress our efficient growth strategy by adding high-quality assets adjacent to our existing integrated footprint,” said Willie Chiang, Chairman and CEO of Plains. “Importantly, these transactions create immediate value by delivering sustainable accretion to earnings, distributable cash flow and accelerating return of capital to unitholders. Our capital allocation framework remains intact, and we remain committed to financial flexibility, capital discipline, generating meaningful free cash flow and increasing return of capital to our unitholders as demonstrated today.”
About Plains
PAA is a publicly traded master limited partnership that owns and operates midstream energy infrastructure and provides logistics services for crude oil and natural gas liquids (NGL). PAA owns an extensive network of pipeline gathering and transportation systems, in addition to terminalling, storage, processing, fractionation and other infrastructure assets serving key producing basins, transportation corridors and major market hubs and export outlets in the United States and Canada. On average, PAA handles approximately eight million barrels per day of crude oil and NGL.
PAGP is a publicly traded entity that owns an indirect, non-economic controlling general partner interest in PAA and an indirect limited partner interest in PAA, one of the largest energy infrastructure and logistics companies in North America.
PAA and PAGP are headquartered in Houston, Texas. More information is available at www.plains.com.
Investor Relations Contacts:
Blake Fernandez
Michael Gladstein
plainsIR@plains.com
(866) 809-1291
FAQ
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