ONEOK to Sell Three Interstate Natural Gas Pipeline Systems for $1.2B
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ONEOK, Inc. OKE announced that it has executed a definitive agreement with DT Midstream, Inc. DTM. Under this agreement, ONEOK will sell its three wholly owned interstate natural gas pipeline systems for a total cash consideration of $1.2 billion, subject to customary adjustments.The transaction, unanimously approved by the boards of directors of both ONEOK and DT Midstream, is expected to be closed in the fourth quarter of 2024, subject to customary closing conditions, including Hart-Scott-Rodino Act clearance.Key Details of OKE’s DealThe three interstate natural gas pipeline systems consist of Guardian Pipeline, L.L.C. links to local natural gas distribution and power generation firms in Wisconsin, as well as a number of pipes at the Chicago Hub near Joliet, IL. The second is Midwestern Gas Transmission — a bidirectional system that includes several interstate pipelines with access to the Marcellus and Utica shale, a major pipeline interconnect near Portland, TN, and multiple interstate pipelines at the Chicago Hub near Joliet, IL.The third is Viking Gas Transmission — a two-way system that connects to a significant pipeline network at the U.S. border close to Marshfield, WI, and Emerson, Canada.According to Federal Energy Regulatory Commission filings, as of June 30, 2024, the purchase price was 10.8 times the previous year's EBITDA.The net proceeds from the sale are anticipated to improve ONEOK's financial flexibility and its deleveraging trend as it moves closer to its previously stated goal of 3.5 times in 2026.Other Oil & Gas Company’s DivestitureHere are some oil and gas companies that take strategic actions to grow their businesses.EQT Corporation EQT, a leading U.S.-based natural gas producer, is reportedly in talks with Blackstone, a major private equity firm, to sell minority stakes in its interstate natural gas pipelines, per Reuters. The transaction is valued at approximately $3.5 billion. This might ease a considerable amount of EQT's debt burden. Per Reuters, EQT will continue to operate the pipeline after the deal is finalized.The Zacks Consensus Estimate for 2024 sales indicates a year-over-year increase of 7.8%. The company delivered an average earnings surprise of 56% in the trailing four quarters.TC Energy Corporation TRP has an agreement to sell its Prince Rupert Gas Transmission project (“PRGT”) to Nisga’a Nation and Western LNG. PRGT is a natural gas pipeline project in British Columbia, the westernmost province of Canada, that would support the development of liquefied natural gas exports. The divestiture aligns with TC Energy's strategic priorities for 2024, which focus on disciplined capital allocation within its established investment framework, maximizing asset value and enhancing its overall financial strength.TRP’s long-term (three to five-year) earnings growth rate is 4%. It delivered an average earnings surprise of 12.7% in the trailing four quarters.OKE’s Price PerformanceOver the past three months, ONEOK’s shares have risen 30.6% compared with the industry’s 13.9% growth. Image Source: Zacks Investment ResearchOKE’s Zacks RankONEOK currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report ONEOK, Inc. (OKE): Free Stock Analysis Report EQT Corporation (EQT): Free Stock Analysis Report TC Energy Corporation (TRP): Free Stock Analysis Report DT Midstream, Inc. (DTM): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks
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