Phillips 66 to acquire public common units of DCP Midstream for $41.75 per unit

Phillips 66 (PSX) and DCP Midstream (DCP) announced that they have entered into a definitive agreement pursuant to which Phillips 66 will acquire all of the publicly held common units representing limited partner interests in DCP Midstream for cash consideration of $41.75 per common unit, increasing its economic interest in DCP Midstream to 86.8%. In combination with the previously announced realignment of Phillips 66’s economic and governance interests in DCP Midstream, the transaction is expected to generate an incremental $1B of adjusted EBITDA for Phillips 66. In addition, Phillips 66 expects to capture operational and commercial synergies of at least $300M by integrating DCP Midstream into its existing midstream business. Phillips 66 plans to fund the approximately $3.8B cash consideration through a combination of cash and debt while maintaining its current investment grade credit ratings. The transaction is expected to close in the second quarter of 2023, subject to customary closing conditions. The transaction was unanimously approved by the board of directors of DCP Midstream GP, LLC, the general partner of DCP Midstream GP, LP, the general partner of DCP Midstream, based on the unanimous approval and recommendation of a special committee comprised entirely of independent directors after evaluation of the transaction by the special committee in consultation with independent financial and legal advisors. Affiliates of Phillips 66, as the holders of a majority of the outstanding DCP Midstream common units, have delivered their consent to approve the transaction. As a result, DCP Midstream has not solicited and is not soliciting approval of the transaction by any other holders of DCP Midstream common units.