Enterprise Products Partners LP announced on Oct. 1 that it acquired the general partner and related incentive distribution rights, 15,899,802 common units and 38,899,802 subordinated units in Oiltanking Partners LP from Oiltanking Holding Americas Inc. Enterprise paid total consideration of about $4.41 billion to Oiltanking Holding, made up of $2.21 billion in cash and 54,807,352 Enterprise common units. Enterprise also paid $228 million to assume notes receivable issued by Oiltanking Partners. Enterprise funded the cash consideration from cash on hand and borrowings under its commercial paper facility and a new $1.5 billion 364-day revolving credit facility. The facility matures in September 2015.
Enterprise also submitted a proposal to the conflicts committee of the general partner of Oiltanking Partners to merge Oiltanking Partners with and into Enterprise. Under the terms of the proposal, Enterprise would exchange 1.23 Enterprise common units for each Oiltanking Partners common unit. This proposed consideration represents an at-market value for Oiltanking Partners common units based upon the volume weighted average trading prices of both Oiltanking Partners and Enterprise on Sept. 30. Total consideration for this proposal would be $1.4 billion.
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