PAA Natural Gas Storage, L.P. (NYSE:PNG) today announced that it has entered into a definitive agreement and plan of merger with Plains All American Pipeline, L.P. (the "Merger Agreement") that provides for a merger whereby PNG will become a wholly-owned subsidiary of Plains All American Pipeline, L.P. ("PAA") through a unit-for-unit exchange (the "Merger"). Under the terms of the Merger Agreement, PNG's public unitholders will receive 0.445 common units of PAA per PNG common unit surrendered pursuant to the Merger Agreement, plus cash in lieu of any fractional common units of PAA otherwise issuable in the Merger.
Anyone have any idea where these units of PAA which are being used to buy PNG are coming from? Are they on hand or do they need to be 'printed'. In other words, is this a dilution of existing shares? If so, at least we're getting something positive out of it.