Press release
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Keyera to Acquire Plains' Canadian NGL Business in a Transformative $5.15 Billion Transaction Transaction expands Keyera's integrated NGL value chain, enhances value for customers, accelerates growth and delivers immediate value for shareholders /NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES ./ Transaction Highlights Transformational acquisition – Keyera will acquire substantially all of Plains' Canadian NGL business, plus select U.S. assets, for total cash consideration of $5.15 billion , subject to adjustments (the "Acquisition"), significantly expanding Keyera's liquids infrastructure platform across western and eastern Canada . Supports Canada's strategic infrastructure – Keyera, a Canadian-based company, is acquiring these assets from a U.S. based seller, bringing key Canadian NGL infrastructure under experienced Canadian ownership. The transaction enhances domestic energy infrastructure and energy security, supports economic resilience, and establishes a strong, cross-Canada NGL corridor. Enhances value for customers – The combined platform will provide customers with more reliable and efficient services, and diversified market access. Highly strategic asset base – The acquired portfolio includes large scale NGL extraction, fractionation, storage, pipelines and terminalling infrastructure located in key hubs such as Empress , Fort Saskatchewan and Sarnia , complementing Keyera's existing operations. Attractive valuation and accretion – The purchase price represents an acquisition multiple of approximately 7.8x expected 2025 adjusted EBITDA¹, or approximately 6.8x including near-term run-rate synergies. The transaction is expected to be accretive to distributable cash flow (DCF) per share¹, delivering mid-teens percentage accretion in the first full year. Scalable platform with visible growth – Pro forma, Keyera is expected to have an enterprise value of approximately $19 billion . The combined platform is expected to deliver an approximate 50% increase in fee-based adjusted EBITDA 1 in the first full year following closing, driven primarily by the contribution of the acquired assets, and including near-term synergies. Strong and stable cash flow – Pro forma, approximately 70% of Keyera's realized margin 1 will be generated from fee-for-service business segments, of which approximately 45% will be from take-or-pay contracts, consistent with its current business mix. Strengthened dividend growth profile – The transaction enhances the sustainability of Keyera's dividend through accretive growth in fee-for-service cash flow and a conservative pro forma payout ratio 1 . The Company remains committed to its long-term payout ratio target of 50% to 70% of DCF 1 . Meaningful synergies – Keyera expects to realize approximately $100 million in highly achievable, near-term run-rate synergies from corporate cost savings and operational efficiencies. Beyond this, the transaction unlocks significant longer-term upside through commercial, logistical, and capital optimization opportunities across the integrated platform. Maintains financial strength and flexibility – The funding plan has been structured to preserve Keyera's strong balance sheet and investment grade credit ratings. Pro forma
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leverage is expected to remain within Keyera's long-term target range of 2.5 to 3.0 times net debt to adjusted EBITDA 1,2 . CALGARY, AB , June 17, 2025 /CNW/ - Keyera Corp. (TSX: KEY) ("Keyera" or the "Company") today announced it has entered into a definitive agreement to acquire substantially all of Plains' Canadian natural gas liquids ("NGL") business, plus select U.S. assets, for total cash consideration of $5.15 billion , subject to adjustments (the "Transaction"). The Acquisition expands Keyera's position as a leading Canadian energy infrastructure company with a fully connected NGL corridor stretching from western to eastern Canada . By bringing these assets under Canadian ownership, the transaction reinforces Canada's economic resilience by strengthening domestic infrastructure and helping to unlock the full potential of Canada's energy future. With core NGL infrastructure in Alberta , the combined platform enables access to high- demand markets through Liquefied Petroleum Gas export access on the West Coast, while also reaching key consumption hubs in eastern Canada and the United States . The acquired assets include NGL extraction, fractionation, storage, and rail and truck terminals located across Alberta , Saskatchewan , Manitoba and Ontario . "This is a highly strategic acquisition that strengthens our core business and accelerates our growth trajectory," said Dean Setoguchi , President and Chief Executive Officer of Keyera. "The assets we are acquiring are high-quality, synergistic, and strongly aligned with our operational footprint and expertise. This transaction enhances our ability to serve customers, capture meaningful operational efficiencies, and deliver sustainable long-term value for shareholders, while also helping to reinforce Canada's position as a global energy leader." Strategic Rationale: A Natural Extension of Keyera's Integrated Platform The Acquisition directly supports Keyera's long-term strategy of expanding its integrated, fee-for- service NGL platform through disciplined growth. The Acquisition strengthens Keyera's position across the entire value chain and enhances market access for customers across all major NGL products, including ethane, propane, butane, condensate, and iso-octane. The combined platform also creates a strong foundation for future optimization and expansion. Specifically, the transaction: Enhances scale of NGL infrastructure by combining Keyera's and Plains' gathering fractionation and storage operations Extends integrated value chain to eastern North America , providing geographic diversification and expanded reach to customers Complements existing business segments and product flows , with additional capacity and flexibility to transport, store, and market ethane, propane, butane and condensate Unlocks commercial potential by applying Keyera's expertise in risk management, marketing, and operational optimization to improve margins and drive performance Delivers meaningful synergies with approximately $100 million of expected near-term annual corporate cost savings and operational enhancements in the first full year Maintains strong contract foundation with approximately 70% of pro forma realized margin supported by long-term commercial agreements supporting dividend sustainability and growth Creates a platform for future investment , positioning Keyera to pursue further integration opportunities and capital-efficient expansions along its cross Canada NGL corridor Delivering Greater Value to Customers The combined assets create a more capable and efficient NGL platform, expanding market connectivity and service offerings across North America . With a larger footprint and stronger integration, Keyera can deliver more reliable, flexible, and cost-effective solutions to customers. The Company's expanded reach will support customers in accessing high-value markets.
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Acceleration of Growth The combination of the two platforms is expected to materially enhance Keyera's growth outlook. Pro forma, fee-based adjusted EBITDA 1 is projected to grow by approximately 50% in the first full year and includes near-term synergies. This growth will be further enhanced by the realization of identified longer-term synergies, and the completion of projects already underway. Fully Financed Transaction, Structured to Maintain Investment Grade Ratings Keyera has obtained fully committed financing to fund the entire $5.15 billion purchase price through an acquisition credit facility in place with the Royal Bank of Canada and a syndicate of other lenders, and a $1.8 billion bought deal equity offering of subscription receipts (the "Offering"), announced separately. The Offering is expected to fully address Keyera's planned discrete common equity issuance needs to finance this transaction. The remainder of the purchase price is expected to be funded through the issuance of debt securities and bank facilities of various tenors. Keyera expects to maintain its investment grade ratings assigned by S&P and DBRS following the closing of the Acquisition. Financial Framework and Capital Allocation Priorities Unchanged Keyera has a long-standing track record of creating value for shareholders through disciplined capital allocation and prudent financial management. That approach is not changing. This transaction has been structured to preserve balance sheet strength, provide flexibility for future growth, and ensure continued returns to shareholders through all phases of the cycle. Pro forma leverage is expected to remain within the Company's long-term target range of 2.5 to 3.0 times net debt to adjusted EBITDA 1,2 . Keyera anticipates being within this range following the closing of the transaction. Supported by its stable fee-for-service business model and strong free cash flow generation, Keyera remains well positioned to continue operating with one of the strongest balance sheets in the sector. The Company's dividend strategy remains firmly anchored in fee-for-service cash flow growth and a conservative payout ratio in the range of 50% to 70% of DCF 1 . The transaction enhances the sustainability of Keyera's dividend by increasing the scale and stability of cash flows. Commitment to Sustainability Keyera remains steadfast in its commitment to sustainability, building upon its established leadership in environmental stewardship, safety, governance, and community engagement. The combined organization will continue to integrate sustainability into its core operations, ensuring long-term value creation for stakeholders. This includes a continued focus on reducing emissions intensity. Acquired Assets Overview The acquired assets represent a broad and strategically located midstream platform spanning western and eastern Canada offering an integrated suite of NGL services. On a combined basis, the portfolio includes: C3+ Fractionation capacity of approximately 193,000 barrels per day (post-PFS expansion), including field, straddle, and hub-based facilities. Storage capacity of approximately 23 million barrels, supporting both operational and commercial flexibility across multiple locations. Over 1,500 miles of pipeline infrastructure , with aggregate throughput capacity of over
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575,000 barrels per day. Straddle gas processing capacity of approximately 5.7 Bcf/d (gross), through the Empress facility. Loading and logistics infrastructure , including truck and rail terminals in Canada and the US that enhance connectivity to end-use markets. Approvals and Timing The Transaction has been unanimously approved by Keyera's Board of Directors and is expected to close in the first quarter of 2026, subject to the satisfaction or waiver of customary closing conditions, including clearance under the Competition Act ( Canada ) and other applicable regulatory reviews. Conference Call and Webcast Keyera will be conducting a conference call and webcast with an accompanying presentation for investors, analysts, brokers and media representatives at 2:30 p.m. Mountain Time ( 4:30 p.m. Eastern Time ) on Tuesday, June 17, 2025 . A live webcast of the conference call can be accessed by clicking here or through Keyera's website at http://www.keyera.com/news/events . Shortly after the call, a webcast archive will be posted on the website for 90 days. Callers may participate by audio only by dialing 1-888-510-2154 or 1-437-900-0527. A replay of the conference call will be available until 10:00 PM Mountain Time on Tuesday , July 15, 2025 ( 12:00 AM Eastern Time ), by dialing 1-888-660-6345 or 1-289-819-1450 and entering passcode 78563. To join the conference call without operator assistance, you may register and enter your phone number here to receive an instant automated call back. Advisors RBC Capital Markets is acting as lead financial advisor to Keyera and is acting as lead left arranger and lead left bookrunner on the acquisition credit facilities. Jefferies is also acting as a financial advisor to Keyera. Norton Rose Fulbright Canada LLP and McCarthy Tetrault LLP are acting as legal advisors to Keyera. About Keyera Corp. Keyera Corp. (TSX:KEY) operates an integrated Canadian-based energy infrastructure business with extensive interconnected assets and depth of expertise in delivering energy solutions. Its predominantly fee-for-service based business consists of natural gas gathering and processing; natural gas liquids processing, transportation, storage and marketing; iso-octane production and sales; and an industry-leading condensate system in the Edmonton / Fort Saskatchewan area of Alberta . Keyera strives to provide high quality, value-added services to its customers across North America and is committed to conducting its business ethically, safely and in an environmentally and financially responsible manner. Additional Information For more information about Keyera Corp., please visit our website at www.keyera.com or contact: Investor Inquiries Dan Cuthbertson , General Manager, Investor Relations Katie Shea , Senior Advisor, Investor Relations
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Email: ir@keyera.com Telephone: 1-403-205-7670 Toll free: 1-888-699-4853 Media Inquiries Brandon Wood , Director, External Affairs Email: media@keyera.com Telephone: 1-855-797-0036 Notes: 1 This term is not a standard measure under GAAP. See the section of this news release titled "Non-GAAP and Other Financial Measures" for additional information. 2 Net debt to adjusted EBITDA is calculated in accordance with the covenant test calculations related to the Corporation's credit facility and senior note agreements and excludes hybrid notes. Non-GAAP and Other Financial Measures This news release refers to certain financial and other measures that are not determined in accordance with Generally Accepted Accounting Principles ("GAAP") and as a result, may not be comparable to similar measures reported by other entities. These non-GAAP and other financial measures are intended to provide investors with supplemental information to assess the financial performance and strategic impact of the transaction. Specifically, this news release references non-GAAP financial measures including adjusted EBITDA, distributable cash flow ("DCF"), DCF per share, payout ratio, realized margin and fee-based adjusted EBITDA. These measures do not have standardized meanings under GAAP and should not be considered in isolation or as a substitute for performance measures reported under GAAP. Management believes these measures facilitate the understanding of Keyera's operating results, financial position, and expected impact of the transaction, particularly in relation to cash flow stability, dividend sustainability, and long-term growth. Forward-looking metrics such as expected synergies, accretion to DCF per share and pro forma leverage are based on certain assumptions and estimates that are subject to change. These forward-looking measures should not be considered guidance or guarantees of future performance. For additional information regarding the composition of these measures, including reconciliations to the most directly comparable GAAP measures where available, refer to Keyera's Management's Discussion and Analysis for the most recently completed period, or the shelf prospectus supplement which is available on SEDAR+ at www.sedarplus.ca and on Keyera's website at www.keyera.com . Specifically, refer to the sections titled: "Non-GAAP and Other Financial Measures" "Segmented Results of Operations" "EBITDA and Adjusted EBITDA" "Dividends: Funds from Operations, Distributable Cash Flow and Payout Ratio" "Forward-Looking Statements" Forward-Looking Information Certain statements contained herein, including future-oriented financial information or financial outlooks, within the meaning of applicable securities laws, are forward-looking (collectively, "forward-looking statements"). The forward-looking statements contained herein are intended to provide readers with information regarding Keyera, including its assessment of future plans, operations and financial performance related to the Acquisition and the Offering, benefits of the Acquisition, financing of the Acquisition, Keyera's dividend growth and financial position post- Acquisition, Keyera's position in the market and long-term strategy, Keyera's commitment to sustainability post-Acquisition, the combined portfolio of acquired assets and the approvals and timing of the Acquisition. The forward-looking statements contained herein may not be appropriate
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for other purposes. These forward-looking statements relate to future events or Keyera's future performance. Such statements are predictions only and actual events or results may differ materially. Forward-looking statements are typically identified by words such as "anticipate", "continue", "estimate", "expect", "may", "will", "project", "should", "plan", "intend", "believe", "expand", "enhance", "accelerate", "deliver", "support", "unlock", "position", "strengthen", "optimize", "extend", "maintain", "create", "preserve" and similar expressions, including the negatives thereof. All statements other than statements of historical fact contained in this document are forward-looking statements. The forward-looking statements reflect management's current beliefs and assumptions with respect to such things as the outlook for general economic trends, industry trends, commodity prices, capital markets, and the governmental, regulatory, and legal environment. In some instances, forward- looking statements contained herein may be attributed to third party sources. Management believes that its assumptions herein are reasonable and that the expectations reflected in the forward-looking statements contained herein are also reasonable based on the information available on the date such statements were made, and the process used to prepare the information. However, Keyera cannot assure readers that these expectations will prove to be correct. All forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, events, levels of activity and achievements to differ materially from those anticipated in the forward-looking statements. For information about the risk factors that could cause actual results to differ materially from forward-looking statements, as well as other assumptions used to develop the forward looking statements, please refer to Keyera's filings made with Canadian provincial securities commissions, including Keyera's 2024 Year-End Report dated February 13, 2025 and in Keyera's Annual Information Form, dated March 5, 2025 which can be viewed on SEDAR+ at www.sedarplus.ca and on the Keyera website at www.Keyera.com . Readers are cautioned that the foregoing is not exhaustive, that they should not unduly rely on these forward-looking statements and that the forward-looking statements in this news release speak only as of the date hereof. Unless required by law, Keyera does not intend and does not assume any obligation to update its forward-looking statements. All forward-looking statements contained in this news release are expressly qualified by this cautionary statement. Further information about the factors affecting forward-looking statements and management's assumptions and analysis thereof, is available in filings made by Keyera with Canadian provincial securities commissions, which can be viewed on SEDAR+ at www.sedarplus.ca . SOURCE Keyera Corp. View original content to download multimedia: http://www.newswire.ca/en/releases/archive/June2025/17/c0427.html %SEDAR: 00030977E CO: Keyera Corp. CNW 16:13e 17-JUN-25