UGI Corporation (NYSE:UGI) entered into an agreement to acquire remaining 74.5% stake in AmeriGas Partners, L.P. (NYSE:APU) from Amerigas Propane, Inc. and others for approximately $2.5 billion on April 1, 2019. Under the terms of transaction, each unitholder of AmeriGas Partners, L.P. will have the right to receive, at election (i) 0.6378 shares of UGI common stock (ii) (A) $7.63 in cash, without interest, and (B) 0.500 UGI Shares; or (iii) $35.325 in cash, without interest. The deadline for record holders to elect the form of consideration is August 20, 2019. As part of the transaction, AmeriGas Partners, L.P. will no longer be a Master Limited Partnership and will instead become a wholly owned subsidiary of UGI. All existing loan of AmeriGas will remain outstanding at closing. As a result of transaction, AmeriGas Partners, L.P. will hold approximately 18% stake in UGI Corporation. Pursuant to the merger agreement, Amerigas Propane, Inc.'s 1% economic general partner interest in AmeriGas Partners, including its incentive distribution rights, was converted into 10.62 million common units, which remain outstanding as limited partnership interests in AmeriGas Partners, and a non-economic general partner interest in AmeriGas Partners, which also remains outstanding after the merger. The common units owned by Amerigas Propane, Inc. 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 AmeriGas Partners. UGI plans to finance the cash portion of the transaction by entering into a bank term loan. JPMorgan Chase Bank agreed to arrange and syndicate senior, unsecured term loans in an aggregate principal amount of up to $550 million, available in two tranches of $250 and $300 million and senior, unsecured revolving credit loans in an aggregate principal amount of up to $300 million. The proceeds would be used to finance the acquisition. The transaction will also be funded with cash on hand and borrowings under one or more credit facilities of UGI. In the event of termination, AmeriGas Partners, L.P. will pay UGI a termination fee equal to $20 million.

The transaction is subject to certain customary conditions, including, approval by holders of a majority of the unit holders of AmeriGas Partners, L.P. at a special meeting to be held on August 21, 2019; no law or injunction prohibiting consummation of the transactions contemplated under the transaction; effectiveness of a registration statement on Form S-4 relating to the issuance of UGI shares; approval for listing on the New York Stock Exchange of the UGI shares issuable pursuant to the merger agreement; subject to specified materiality standards, the accuracy of certain representations and warranties of the other party; and compliance by the respective parties in all material respects with their respective covenants. The Board of Directors of UGI has unanimously approved the merger agreement. Audit Committee of the Board of Directors of AmeriGas Propane, Inc. has also determined the transaction to be fair and reasonable. The Board of AmeriGas Propane, Inc. also recommended the unit holders of AmeriGas Partners, L.P. vote in favor of the transaction. Pursuant to a support agreement, AmeriGas Propane, Inc., which owns the general partner interest in AmeriGas, including the incentive distribution rights, as well as 23.76 million AmeriGas common units representing approximately 25.5% stake in AmeriGas, has agreed to vote all of the AmeriGas common units owned beneficially or of record by it in favor of the transaction. Tudor Pickering Holt & Co Advisors LP also rendered its opinion that the merger consideration to be paid to the unaffiliated unitholders of AmeriGas was fair from a financial point of view to such unaffiliated unitholders. Further, the Board of UGI received an opinion from J.P. Morgan Securities LLC that the merger consideration to be paid by UGI in the merger pursuant to the merger agreement is fair, from a financial point of view, to UGI. As of August 6, 2019, transaction received regulatory approval. The transaction is expected to close in the fourth quarter of fiscal 2019. As of August 6, 2019, transaction is expected to close later in the third quarter. As of August 12, 2019, the transaction is expected to close on August 21, 2019. The deal is expected to be accretive to adjusted EPS (Earnings per Share) beginning in fiscal 2020.

Lance Gilliland, Paul Perea, Jonathan Sherman, Will Moore, Mason Wleczyk and William Xia of Tudor Pickering Holt & Co Advisors LP ('Tudor') acted as financial advisors for AmeriGas Partners, L.P.'s Audit Committee while Andrew Castalso and Robert Kimmel of J.P. Morgan Securities LLC acted as financial advisors for UGI. Ryan J. Maierson, John M. Greer, Kevin Richardson, Dan Harrist, Blake Berkey, Erin Lee, Tim Fenn, Bryant Lee, Jared Grimley, Adam Kestenbaum, Joel Mack, Joshua Marnitz, Jason Cruise, Peter Todar and Hillarie James of Latham & Watkins LLP acted as legal advisors for UGI. Mark A. Morton and Thomas A. Mullen of Potter Anderson & Corroon, LLP along with Joshua Davidson, Andrew J. Ericksen, Eileen Boyce, Catherine Ellis, Mike Bresson, Jared Meier and Rob Fowler of Baker Botts L.L.P. acted as legal advisors for AmeriGas Partners, L.P. Simpson Thacher represented J.P. Morgan Securities LLC, as financial advisor to UGI Corporation. Tull Florey from Gibson, Dunn & Crutcher LLP served as the legal advisor to Tudor. Upon preparation and delivery of Tudor's opinion to the audit committee of AmeriGas Propane, Inc., Tudor became entitled to receive fees of $1 million. Tudor will be entitled to receive a fee of $2 million payable upon consummation of the merger. J.P. Morgan will receive a fee from UGI of $7.5 million for its financial advisory services rendered in connection with the merger, a portion of which became payable in connection with J.P. Morgan's delivery of the opinion and a substantial portion of which will be contingent upon the consummation of the merger. Tudor Pickering Holt & Co Advisors LP acted as the fairness opinion provider to AmeriGas. Computershare, Inc. acted as the transfer agent and registrar to UGI. Innisfree M&A Inc. acted as the information agent to AmeriGas and will receive a fee of $22,500 for its services.

UGI Corporation (NYSE:UGI) completed the acquisition of remaining 74.5% stake in AmeriGas Partners, L.P. (NYSE:APU) from Amerigas Propane, Inc. and others on August 21, 2019. In connection with the merger, Brian R. Ford, John R. Hartmann, Frank S. Hermance, William J. Marrazzo, Anne Pol, Pedro A. Ramos, Marvin O. Schlanger and K. Richard Turner resigned as members of the Board of Directors of Amerigas Propane, Inc. The remaining Directors of the Board elected Monica M. Gaudiosi and Ted J. Jastrzebski to become, effective immediately after the effective time of the merger, members of the Board to fill vacancies created by the resigning Directors. Following the completion of the merger, the Board consists of John L. Walsh, Hugh J. Gallagher, Roger Perreault, Monica M. Gaudiosi and Ted. J. Jastrzebski. The executive officers of Amerigas Propane, Inc. immediately prior to the effective time of the merger will continue to serve as the executive officers of Amerigas Propane, Inc. after the merger. The transaction was approved by the unit holders of AmeriGas and all conditions required to complete the merger have been satisfied. AmeriGas Partners, L.P. common units will continue to trade on the New York Stock Exchange on August 21, 2019 and will be suspended from trading on the NYSE effective as of the opening of trading on August 22, 2019.