Energy Income Partners to Vote Against $18.8 Billion ONEOK-Magellan Deal
(Reuters) — Asset manager Energy Income Partners LLC, one of the top shareholders in Magellan Midstream Partners, said on Thursday that it intends to vote against pipeline operator ONEOK Inc.'s deal to buy Magellan.
Energy Income said in a letter addressed to the company's board that the taxes paid by its funds and investors will exceed the premium offered by ONEOK and any potential benefits from the merger.
Energy Income is the fourth largest shareholder in Magellan with a roughly 3% stake.
RELATED: ONEOK to Acquire Pipeline Operator Magellan Midstream in $18.8 Billion Deal
The asset manager also said it wants Magellan to remain a stand-alone entity whose returns on invested capital are far superior to ONEOK.
ONEOK said last month that it would acquire Magellan in a cash-and-stock deal valued at about $18.8 billion.
"We remain focused on completing the transaction with ONEOK and delivering on the many compelling benefits of this combination," Magellan said in a statement, adding that the transaction gives Magellan investors an opportunity to benefit from the upside potential and attractive cash dividend of the combined company.
ONEOK did not immediately respond to requests for comment.
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