UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
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| Item 2.01. | Completion of Acquisition or Disposition of Assets. |
On August 21, 2019, UGI Corporation (“UGI”) completed its previously announced acquisition of all of the outstanding common units representing limited partnership interests (the “Common Units”) in AmeriGas Partners, L.P. (the “Partnership”) not already held by UGI or one of its subsidiaries (the “Public Common Units”), via a merger of AmeriGas Propane Holdings, LLC (“Merger Sub”), an indirect, wholly owned subsidiary of UGI, with and into the Partnership, with the Partnership surviving as an indirect, wholly owned subsidiary of UGI (the “Merger”), pursuant to the Agreement and Plan of Merger, dated as of April 1, 2019 (the “Merger Agreement”), by and among the Partnership, UGI, AmeriGas Propane Holdings, Inc. (“Holdings”), Merger Sub and AmeriGas Propane, Inc., the general partner of the Partnership (the “General Partner”).
Pursuant to the Merger Agreement, each Public Common Unit was automatically converted at the effective time of the Merger into the right to receive, at the election of each holder of Public Common Units, but subject to any applicable withholding tax and the proration pursuant to the Merger Agreement, one of the following forms of consideration (collectively, the “merger consideration”): (i) 0.6378 (the “Share Multiplier”) shares of UGI common stock (“UGI Shares”); (ii) $7.63 in cash, without interest, and 0.500 UGI Shares; or (iii) $35.325 in cash, without interest. In each case, cash in lieu of any fractional UGI Shares, without interest, will be paid.
Under the Merger Agreement, each unvested award of a performance unit (an “AmeriGas Performance Unit”), other than an AmeriGas Performance Unit or portion thereof that was eligible to be earned based on the Partnership’s total unitholder return over a designated performance period subject to any applicable modifier (each, an “AmeriGas TUR Unit”), outstanding immediately prior to the completion of the Merger was, as of the effective time of the Merger, automatically cancelled and converted into a number of cash-settled performance-based restricted stock units relating to UGI Shares determined by multiplying the number of AmeriGas Performance Units subject to such award by the Share Multiplier.
Each unvested award of an AmeriGas TUR Unit outstanding immediately prior to the completion of the Merger was, as of the effective time of the Merger, automatically cancelled and converted into a number of cash-settled restricted stock units relating to UGI Shares determined by multiplying (i) the target number of AmeriGas TUR Units subject to such award, by (ii) the Share Multiplier, and (iii) the TUR Performance Multiplier. The “TUR Performance Multiplier” will be equal to the greater of 100% or such percentage as is determined in accordance with the terms of the applicable award agreement governing the applicable AmeriGas TUR Units.
Each unvested award of a restricted Common Unit issued under the AmeriGas Propane, Inc. 2010 Long-Term Incentive Plan on behalf of AmeriGas Partners, L.P., as amended (the “AmeriGas LTIP” and each such award, an “AmeriGas Restricted Unit”), outstanding immediately prior to the completion of the Merger was, as of the effective time of the Merger, automatically cancelled and converted into a number of cash-settled restricted stock units relating to UGI Shares determined by multiplying the number of AmeriGas Restricted Units subject to such award by the Share Multiplier.
Each outstanding award of a phantom unit relating to a Common Unit issued under an AmeriGas LTIP (each, an “AmeriGas Phantom Unit” and together with the AmeriGas Performance Units, AmeriGas TUR Units and AmeriGas Restricted Units, the “AmeriGas LTIP Awards”) outstanding immediately prior to the completion of the Merger was, as of the effective time of the Merger, cancelled and converted into a number of cash-settled restricted stock units relating to UGI Shares determined by multiplying the number of AmeriGas Phantom Units subject to such award by the Share Multiplier.
Prior to the Merger, UGI indirectly owned the General Partner, and controlled the Partnership through its ownership of the General Partner. The General Partner owned the general partner interest in the Partnership, including a 1% economic general partner interest (which includes incentive distribution rights), as well as approximately 25.5% of the outstanding Common Units. Pursuant to the Merger Agreement, the General Partner’s 1% economic general partner interest in the Partnership was converted into (i) 10,615,711 Common Units, which remain outstanding as limited partnership interests in the Partnership, and (ii) a non-economic general partner interest in the Partnership, which also remains outstanding after the Merger. The Common Units owned by the General Partner that were issued and outstanding immediately prior to the completion of the Merger were unaffected by the Merger and remain outstanding as limited partnership interests in the Partnership.
The foregoing description of the Merger Agreement and the transactions contemplated thereby is not complete and is subject to and qualified in its entirety by reference to the Merger Agreement, which was filed as Exhibit 2.1 to the Current Report on Form 8-K filed by UGI with the Securities and Exchange Commission (the “SEC”) on April 2, 2019 and is incorporated by reference herein.
| Item 7.01. | Regulation FD Disclosure. |
On August 21, 2019, UGI and the Partnership issued a joint press release announcing the completion of the Merger. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference herein. The information set forth in this Item 7.01 and the attached Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 as amended.
| Item 9.01. | Financial Statements and Exhibits. |
(a) Financial Statements of Business Acquired
The financial statements required by Item 9.01(a) of Form 8-K in connection with the Merger will be filed by amendment to this Current Report on Form 8-K (the “Closing Form 8-K”) within 71 calendar days after the date this Closing Form 8-K was required to be filed with the SEC.
(d) Exhibits
| Exhibit |
Description | |||
| 2.1* |
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| 99.1 |
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| 104 |
Cover Page Interactive Data File (the Cover Page Interactive Data File is embedded within the Inline XBRL document). | |||
| * | Schedules and exhibits to this exhibit omitted pursuant to Regulation S-K Item 601(b)(2). UGI agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| UGI Corporation | ||||||
| August 21, 2019 |
By: |
/s/ Monica M. Gaudiosi | ||||
| Monica M. Gaudiosi | ||||||
| Vice President and General Counsel, Secretary | ||||||
Exhibit 99.1
UGI and AmeriGas Partners, L.P. Complete Merger Transaction
VALLEY FORGE, Pa., August 21, 2019 – UGI Corporation (NYSE: UGI; “UGI”) and AmeriGas Partners, L.P. (NYSE: APU; “AmeriGas”) successfully completed the merger transaction that was announced on April 2, 2019. UGI acquired the approximately 69.2 million public common units of AmeriGas it did not already own in completing the buy-in of AmeriGas, the nation’s largest retail propane marketer.
John L. Walsh, president and chief executive officer of UGI, said, “We are pleased to announce the completion of this transaction, which fully consolidates our ownership of AmeriGas and creates a platform for future cash flow and earnings growth for UGI. The transaction enables us to build on our successful 60-year history in U.S. propane distribution. Additionally, the merger presents an opportunity to further align our LPG distribution operations across the U.S. and Europe to drive efficiencies and accelerate growth. Lastly, I would like to welcome the AmeriGas unitholders to UGI. We look forward to being exceptional stewards of your capital.”
The closing follows approval of the transaction by AmeriGas’ unitholders at a special meeting held earlier today. Approximately 93% of the AmeriGas common units represented in person or by proxy at the special meeting, and approximately 60% of the total number of AmeriGas common units outstanding, were voted in favor of the merger transaction. Effective after the end of trading today, AmeriGas’ common units will no longer trade on the New York Stock Exchange.
About UGI Corporation
UGI Corporation is a distributor and marketer of energy products and services. Through subsidiaries, UGI operates natural gas and electric utilities in Pennsylvania, distributes LPG both domestically (through AmeriGas) and internationally, manages midstream energy assets in Pennsylvania, Ohio, and West Virginia and electric generation assets in Pennsylvania, and engages in energy marketing in ten states, the District of Columbia and internationally in France, Belgium, the Netherlands and the UK.
Investor Relations
Brendan Heck, 610-337-1000 ext. 6608
Alanna Zahora, 610-337-1000 ext. 1004
Shelly Oates, 610-337-1000 ext. 3202
Forward-Looking Statements
All statements in this press release (and oral statements made regarding the subjects of this communication) other than historical facts are forward-looking statements. The safe harbor provisions under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, do not apply to forward-looking statements made or referred to in this release. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of uncertainties and factors, many of which are outside the control of UGI and AmeriGas, which could cause actual results to differ materially from such statements. Forward-looking information includes, but is not limited to, the anticipated benefits of the merger. While UGI believes that the assumptions concerning future events are reasonable, it cautions that there are inherent difficulties in predicting certain important factors that could impact the future performance or results of its business. Among the factors that could cause results to differ materially from those indicated by such forward-looking statements are: the failure to realize the anticipated costs savings, synergies and other benefits of the merger and any recent or future transactions, including certain integration risks relating to the acquisition of Columbia Midstream Group, LLC by UGI Energy Services, LLC; the possible diversion of management time on merger-related issues; local, regional and national economic conditions and the impact they may have on UGI, AmeriGas and their customers; changes in tax laws that impact MLPs and the continued analysis of recent tax legislation; conditions in the energy industry, including cost volatility and availability of all energy products, including propane, natural gas, electricity and fuel oil as well as increased customer conservation measures; adverse weather conditions; the financial condition of UGI’s and AmeriGas’ customers; any non-performance by customers of their contractual obligations; changes in customer, employee or supplier relationships; changes in safety, health, environmental and other regulations; liability for uninsured claims and for claims in excess of insurance coverage; domestic and international political, regulatory and economic conditions in the U.S. and in foreign countries, including the current conflicts in the Middle East; foreign currency exchange rate fluctuations (particularly the euro); the timing of development of Marcellus Shale gas production; the results of any reviews, investigations or other proceedings by government authorities; addressing any reviews, investigations or other proceedings by government authorities or shareholder actions, including, but not limited to, pending litigation relating to the merger; the performance of AmeriGas; and the interruption, disruption, failure, malfunction or breach of UGI’s or AmeriGas information technology systems, including due to cyber-attack.
These forward-looking statements are also affected by the risk factors, forward-looking statements and challenges and uncertainties described in each of UGI’s and AmeriGas’ Annual Reports on Form 10-K for the fiscal year ended September 30, 2018, and those set forth from time to time in each entity’s filings with the Securities and Exchange Commission, which are available at www.ugicorp.com and www.amerigas.com, respectively. Except as required by law, UGI and AmeriGas expressly disclaim any intention or obligation to revise or update any forward-looking statements whether as a result of new information, future events or otherwise.