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MPLX to buy fellow MLP Andeavor Logistics in deal valued at $9 billion

Tomi Kilgore

Shares of Andeavor Logistics L.P. rallied 5.7% in premarket trade Wednesday, after the energy midstream logistics master limited partnership agreed to be acquired by MPLX L.P. in a deal valued at $9 billion. Under terms of the deal, Andeavor shareholders will receive 1.135 MPLX shares for each Andeavor share they own, which the companies said represent a 7.3% premium. In addition, Marathon Petroleum Corp. will receive 1.0328 MPLX shares for each Andeavor share held, representing a 2.4% discount. "This transaction simplifies our MLPs into a single listed entity and creates a leading, large-scale, diversified midstream company anchored by fee-based cash flows," said Gary Heminger, who is chief executive of all three entities. The deal is expected to immediately add to MPLX's distributable cash flow. Shares of Marathon Petroleum have tumbled 21.1% over the past 12 months, MPLX has shed 9.1% and Andeavor has dropped 27.6%, while the S&P 500 has gained 7.9%.