Brookfield Infrastructure Partners and its institutional partners have signed a definitive agreement to acquire Colonial Enterprises, including the Colonial Pipeline, for an enterprise value of approximately $9bn.
The deal is expected to close in the second half of 2025, pending customary closing conditions.
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Colonial Enterprises reportedly boasts the largest refined products system in the US, covering around 5,500 miles (8,851.3km) from Texas to New York.
This system has a multi-decade track record of strong performance and high utilisation, serving a high-quality customer base along the US East Coast.
Brookfield Infrastructure’s equity investment is expected to be $500m, funded by recent capital recycling initiatives.
Colonial is jointly held among five partners: Shell Midstream Operating (16.125%), Koch Capital Investments (28.088%), KKR-Keats Pipeline Investors (23.443%), Caisse de dépôt et placement du Québec (16.549%) and IFM Investors (15.795%).
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By GlobalDataMorgan Stanley Senior Funding and Mizuho Bank led the debt financing, with the prior acting as sole bookrunner on the term loan facility.
Brookfield Infrastructure engaged Jefferies, Greenhill & Co., a Mizuho affiliate, and Morgan Stanley as joint financial advisors and Kirkland & Ellis as legal advisor.
Shell Midstream Operating, a subsidiary of Shell, will sell its 16.125% interest in Colonial Enterprises to Colossus AcquireCo, a subsidiary of Brookfield.
Shell Trading & Supply president Andrew Smith said: “This divestment reflects our focus on performance, discipline and simplification. It will allow us to concentrate on areas where we have scale and competitive advantage.”
The transaction, subject to regulatory approvals, is expected to close in the fourth quarter of 2025.
The sale values Shell’s share of Colonial at $1.45bn (£1.14bn), inclusive of approximately $500m in non-recourse debt and excluding customary closing adjustments.
Colonial operates as an independent company and fully owns Colonial Pipeline Company, a non-operated venture, and Colonial Marketing Company.
Colonial Pipeline Company provides oil products transportation services from the US Gulf Coast to the US Atlantic Seaboard.
Brookfield Infrastructure Partners also recently agreed to divest entities that hold its complete 25% minority stake in NGPL Holdings.
