GARDEN CREEK

Natural Gas Processing Plant
North Dakota

ONEOK TO ACQUIRE ONEOK PARTNERS – TRANSACTION VALUED AT $17 BILLION

At ONEOK and ONEOK Partners, an important measurement of company success is the value we create for our investors. Our ability to create value rests in our integrated asset footprint, long-term growth projects, stable cash flows and attractive investment opportunities.

With long-term value creation in mind, we recently took an important step toward enhancing our ability to fund our future capital needs over the long term as we continue to grow.

In February 2017, ONEOK announced plans to acquire the remaining approximately 60 percent public stake in ONEOK Partners – creating a stand-alone operating company with an estimated $30 billion enterprise value and lower cost of funding. Following the merger, we expect to be even more competitive as we continue executing on our growth strategies.

Completing this transaction now underscores the strategic value we place on the business we have successfully built since venturing into the midstream space nearly 20 years ago.

We have performed well in a tough environment; however, this transaction positions ONEOK for continued success through expected:

  • Improved access to broader capital markets to fund future growth opportunities;
  • Strong dividend coverage over the long term;
  • Lower cost of funding with the elimination of incentive distribution rights; and
  • No cash income taxes through at least 2021.

We believe this transaction, which we expect to complete in the second quarter 2017, represents a tremendous opportunity for current ONEOK shareholders and ONEOK Partners unitholders, who will participate in the upside as future shareholders.

We announced an expected dividend increase to 74.5 cents per share in the first quarter following the close of the transaction, a 21 percent increase compared with the fourth quarter 2016. We also anticipate a subsequent 9 to 11 percent annual dividend growth rate through 2021.

This transaction doesn’t change our core businesses or our goal to continue growing as one of North America’s largest midstream service providers; in fact, it enhances them. We remain focused on safely and reliably operating our 37,000-mile, integrated network of natural gas liquids (NGL) and natural gas pipelines stretching from the Canadian border to the Texas Gulf Coast.