|
|
|
|
|
FINDLAY, Ohio, July 13, 2015 - (ACN Newswire) - Marathon Petroleum Corporation (NYSE: MPC) today announced that MPLX LP (NYSE: MPLX), the midstream master limited partnership (MLP) sponsored by MPC, has signed a definitive merger agreement with MarkWest Energy Partners, L.P. (NYSE: MWE) (MarkWest) whereby MarkWest would become a wholly owned subsidiary of MPLX. The merger would be a unit-for-unit transaction, generally expected to be tax-free, plus a one-time cash payment to MarkWest unitholders, that implies an enterprise value for MarkWest of approximately $20 billion, including the assumption of debt of approximately $4.2 billion, as of the close of trading on Friday, July 10, 2015. MPC would contribute $675 million of cash to MPLX to fund the one-time cash payment.
MarkWest, an MLP that owns and operates midstream service businesses in several liquids-rich natural gas resource plays in the U.S., is the nation's second largest processor of natural gas and the largest processor and fractionator in the Marcellus and Utica shale regions.
"This combination is a significant step in executing MPC's strategy to grow its higher-valued, stable cash flow midstream business, by transforming MPLX into a large-cap, diversified master limited partnership," said President and Chief Executive Officer Gary R. Heminger, noting that the combination would create the fourth-largest MLP with $21 billion in market capitalization. "We are very pleased that MPLX and MarkWest will join forces and provide us with opportunities to increase our participation in the U.S. energy infrastructure build-out."
Heminger said that MPLX affirms its anticipated distribution growth of 29 percent this year and expects a 25 percent compound annual distribution growth rate for the combined entity through 2017. "MPC's strong balance sheet and liquidity will enable MarkWest to accelerate organic growth in some of the nation's most economic and prolific liquids-rich natural gas resource plays," Heminger said. "We expect the combination of these projects and MPC's MLP-eligible midstream assets to support a strong distribution growth profile over an extended period of time for MPLX." Heminger noted that the transaction also enhances the cash flow profile of the general partner and is consistent with MPC's strategic intent to grow the more highly valued stable cash flow elements of the business and diversify its asset base by having multiple platforms from which to grow.
Heminger also noted that the combination of MarkWest and MPLX eliminates the need for the recently proposed MPLX acquisition of MPC's marine transportation assets in 2015. As a result, that transaction has been indefinitely deferred.
The transaction between MPLX and MarkWest, which is subject to approval by MarkWest unitholders, customary closing conditions and regulatory approvals, is expected to close in the fourth quarter of 2015. Upon completion of the transaction, MPC would continue as general partner of MPLX and own approximately 19 percent of MPLX's common units.
Conference Call
At 9 a.m. EDT (7 a.m. MDT) today, MPLX and MarkWest will hold a joint webcast and conference call to discuss this transaction. Interested parties may listen to the conference call by dialing (800) 475-0218 (passcode "9298228") or access via webcast on MPLX's website at http://www.mplx.com/ by clicking on the "Conference Call July 13" link in the "News and Headlines" section, or on MarkWest's website at http://www.markwest.com in the "Presentations & Webcasts" link located under the Investor Relations section.
A replay of the conference call will be accessible on the MPLX and MarkWest websites, or by dialing (866) 347-5803 (no passcode required).
About Marathon Petroleum Corporation
MPC is the nation's fourth-largest refiner, with a crude oil refining capacity of approximately 1.7 million barrels per calendar day in its seven-refinery system. Marathon brand gasoline is sold through approximately 5,500 independently owned retail outlets across 19 states. In addition, Speedway LLC, an MPC subsidiary, owns and operates the nation's second-largest convenience store chain, with approximately 2,750 convenience stores in 22 states. MPC also owns, leases or has ownership interests in approximately 8,300 miles of pipeline. Through subsidiaries, MPC owns the general partner of MPLX LP, a midstream master limited partnership. MPC's fully integrated system provides operational flexibility to move crude oil, feedstocks and petroleum-related products efficiently through the company's distribution network in the Midwest, Southeast and Gulf Coast regions. For additional information about the company, please visit our website at http://www.marathonpetroleum.com.
MPC Investor Relations Contacts:
Geri Ewing +1-419-421-2071
Teresa Homan +1-419-421-2965
MPC Media Contacts:
Chuck Rice +1-419-421-2521
Jamal Kheiry +1-419-421-3312
This press release contains forward-looking statements within the meaning of federal securities laws regarding MPLX LP ("MPLX"), Marathon Petroleum Corporation ("MPC"), and MarkWest Energy Partners, L.P. ("MWE"). These forward-looking statements relate to, among other things, expectations, estimates and projections concerning the business and operations of MPC, MPLX and MWE. You can identify forward-looking statements by words such as "anticipate," "believe," "estimate," "objective," "expect," "forecast," "plan," "project," "potential," "could," "may," "should," "would," "will" or other similar expressions that convey the uncertainty of future events or outcomes. Such forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond the companies' control and are difficult to predict. Factors that could cause MPC's actual results to differ materially from those in the forward-looking statements include: risks described below relating to the MPLX/MWE proposed merger; changes to the expected construction costs and timing of pipeline projects; volatility in and/or degradation of market and industry conditions; the availability and pricing of crude oil and other feedstocks; slower growth in domestic and Canadian crude supply; an easing or lifting of the U.S. crude oil export ban; completion of pipeline capacity to areas outside the U.S. Midwest; consumer demand for refined products; transportation logistics; the reliability of processing units and other equipment; MPC's ability to successfully implement growth opportunities; modifications to MPLX earnings and distribution growth objectives; federal and state environmental, economic, health and safety, energy and other policies and regulations; MPC's ability to successfully integrate the acquired Hess retail operations and achieve the strategic and other expected objectives relating to the acquisition; changes to MPC's capital budget; other risk factors inherent to MPC's industry; and the factors set forth under the heading "Risk Factors" in MPC's Annual Report on Form 10-K for the year ended Dec. 31, 2014, filed with SEC. In addition, the forward-looking statements included herein could be affected by general domestic and international economic and political conditions. Unpredictable or unknown factors not discussed here, in MPLX's Form 10-K, in MPC's Form 10-K, or in MWE's Form 10-K could also have material adverse effects on forward-looking statements. Factors that could cause MPLX's or MWE's actual results to differ materially from those in the forward-looking statements include: their ability to complete the proposed merger of MPLX and MWE on anticipated terms and timetable; the ability to obtain approval of the transaction by the unitholders of MWE and satisfy other conditions to the closing of the transaction contemplated by the merger agreement; the ability to obtain governmental approvals of the MPLX/MWE transaction based on the proposed terms and schedule, and any conditions imposed on the combined company in connection with consummation of the MPLX/MWE transaction; the risk that the costs savings and any other synergies from the MPLX/MWE transaction may not be fully realized or may take longer to realize than expected; disruption from the MPLX/MWE transaction making it more difficult to maintain relationships with customers, employees or suppliers; risks relating to any unforeseen liabilities of MWE or MPLX, as applicable; the adequacy of their respective capital resources and liquidity, including, but not limited to, availability of sufficient cash flow to pay distributions and execute their respective business plans; the timing and extent of changes in commodity prices and demand for crude oil, refined products, feedstocks or other hydrocarbon-based products; volatility in and/or degradation of market and industry conditions; completion of pipeline capacity by competitors; disruptions due to equipment interruption or failure, including electrical shortages and power grid failures; the suspension, reduction or termination of MPC's obligations under MPLX's commercial agreements; each company's ability to successfully implement its growth plan, whether through organic growth or acquisitions; modifications to earnings and distribution growth objectives; federal and state environmental, economic, health and safety, energy and other policies and regulations; changes to MPLX's capital budget; other risk factors inherent to their industry; and the factors set forth under the heading "Risk Factors" in MPLX's Annual Report on Form 10-K for the year ended Dec. 31, 2014, filed with the Securities and Exchange Commission (SEC); and the factors set forth under the heading "Risk Factors" in MWE's Annual Report on Form 10-K for the year ended Dec. 31, 2014, filed with the SEC. Copies of MPLX's Form 10-K are available on the SEC website, MPLX's website at http://ir.mplx.com or by contacting MPLX's Investor Relations office. Copies of MPC's Form 10-K are available on the SEC website, MPC's website at http://ir.marathonpetroleum.com or by contacting MPC's Investor Relations Office. Copies of MWE's Form 10-K are available on the SEC website, MWE's website at http://investor.markwest.com or by contacting MWE's Investor Relations office.
None of MPLX, MPC, or MWE undertake any duty to update any forward-looking statement except as required by law.
MPC announces MPLX MarkWest merger: http://hugin.info/147922/R/1937658/698594.pdf
###
This announcement is distributed by NASDAQ OMX Corporate Solutions on behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Marathon Petroleum Corporation via Globenewswire
Topic: Press release summary
Source: Marathon Petroleum Corporation
https://www.acnnewswire.com
From the Asia Corporate News Network
Copyright © 2024 ACN Newswire. All rights reserved. A division of Asia Corporate News Network.
|
|
|
|
|
|
|
|
