As part of the transaction, Shell USA will acquire all the limited partner interests in the midstream operator it previously didn’t own for $15.85 per share in cash
Shell USA to take full ownership of Shell Midstream Partners. (Credit: Johannes Rupf from Pixabay)
Shell USA, a fully-owned subsidiary of Shell, and publicly-listed US-based midstream operator Shell Midstream Partners (SHLX) have signed a merger deal worth around $1.96bn.
As part of the deal, Shell USA will acquire all the limited partner interests in Shell Midstream Partners it previously didn’t own for $15.85 per share in cash.
Currently, a subsidiary of Shell USA holds 269,457,304 shares of the midstream operator, which represents a stake of 68.5%.
Shell Midstream Partners’ assets include pipelines and other midstream and logistics assets in the US.
The midstream operator’s board reviewed the terms of the deal and the merger agreement and has unanimously approved them.
In February 2022, Shell said that it planned to buy out Shell Midstream Partners in order to streamline the governance of the latter’s assets, cut down costs, and gain the flexibility to optimise the pipeline portfolio.
The deal, which is subject to customary closing conditions, is anticipated to close in Q4 2022.
Shell USA stated: “A subsidiary of Shell USA, as the holder of a majority of the outstanding SHLX common units, has delivered its consent to approve the Transaction concurrently with the execution of the Merger Agreement.
“As a result, SHLX has not solicited and is not soliciting approval of the Transaction by any other holders of SHLX common units.”
In a separate development, Shell U.K.’s affiliate BG International has taken the final investment decision (FID) for developing the Jackdaw gas field in the UK North Sea.
The FID was taken after the receipt of approval from the North Sea Transition Authority (NSTA) and the Offshore Petroleum Regulator for Environment & Decommissioning (OPRED).
According to Shell, Jackdaw will feature a wellhead platform and subsea infrastructure, which will tie back to the company’s existing Shearwater gas hub.
The Jackdaw project is aimed to be brought on stream in the mid-2020s.