Marathon Petroleum Raises Cash Consideration For MPLX/MarkWest Merger

(RTTNews) - MPLX LP (MPLX) and MarkWest Energy Partners L.P. (MWE) announced that in connection with the merger of MPLX and MarkWest, MPLX has agreed to increase the amount of the cash consideration payable to MarkWest common unitholders by $400 million, from $675 million to $1.075 billion.

Under the revised terms of the merger agreement, MarkWest common unitholders will receive 1.09 MPLX common units plus a one-time cash payment of approximately $5.21 per MarkWest common unit, for a total consideration of approximately $52.93 per MarkWest common unit, based on fully diluted units currently outstanding and the closing price of MPLX's common units on November 10, 2015. The increase in cash merger consideration is being contributed to MPLX by its sponsor, Marathon Petroleum Corp. (MPC), under which no new equity units will be issued to MPC.

In addition, as part of the original transaction, MPC will contribute approximately $225 million, based on the price of MPLX's common units on Nov. 10, 2015, to maintain its 2 percent general partner interest in MPLX. These proceeds will be retained by the partnership to support its growth.

All other terms of the merger agreement announced on July 13, 2015, remain the same. The merger is recommended by the boards of directors of MPC, MPLX and MarkWest, and the executive management of both partnerships also strongly support the transaction and its revised terms.

The combination is expected to generate a mid-20 percent compound annual distribution growth rate through 2019.

The transaction is subject to approval by MarkWest unitholders and other customary closing conditions and, subject to the satisfaction of those conditions, is expected to close in December 2015. The date of the special meeting of MarkWest common unitholders is December 1, 2015. MarkWest unitholders of record as of October 5, 2015, will be entitled to vote on approval of the merger and the associated proposals.