Energy Transfer LP ET, +2.05% announced Wednesday an agreement to buy Enable Midstream Partners LP ENBL, +8.14% in a stock deal valued at $7.2 billion. Under terms of the deal, Enable shareholders will receive 0.8595 Energy Transfer shares for each Enable share they own. Based on Tuesday’s stock closing prices, that values Enable shares at $5.98 each, an 8.1% discount. Energy Transfer said the stock exchange ratio represents an “at-the-market” deal, if it is based on the 10-day volume-weighted average of the stock prices on Feb. 12. The merger is expected to generate more than $100 million in annual synergies. Energy Transfer owns and operates energy assets, and Enable owns and operates natural gas and crude oil infrastructure assets. Enable’s stock rose 1.2% in premarket trading while Energy Transfer shares shed 0.6%. Over the past year, shares of Enable have dropped 25.4% and Energy Transfer have tumbled 45.3%, while the SPDR Energy Select Sector ETF XLE, +2.51% has lost 16.1% and the S&P 500 SPX, -0.06% has gained 16.3%.
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