USA-headquartered refiner Phillips 66 (PSX.N) has tendered an offer to acquire public units of DCP Midstream (DCP.N) in a bid to scale up the company's value and output. According to a Reuters report published on Wed August 17, 2022, the deal would bulk up Phillip's natural gas liquids business and value the pipeline operator at $7.2 billion.

The latest move follows another recent acquisition by the company in 2022, marking the first major move by the new Phillips 66's chief executive officer, Mark Lashier, who took office last month. Earlier this year, Phillips 66 acquired public units in a transportation and storage business known as Phillips 66 Partners.

Enbridge (ENB.TO), a Canadian pipeline operator which owns 50% of the DCP's general partner, hinted at reducing its stake in the company from 28.3% to 13.2%. So far, the company has pocketed $400 million in cash from Phillips 66 as part of the deal. After a stake cut, Enbridge will take over as the operator and boost its stake by more than double in Grey Oak pipeline, which was previously operated by Phillips 66.

The Grey Oak pipeline is o0ne of the major pipelines transporting crude oil from West Texas to the US Gulf Coast. Based on the new deal, Phillips 66's economic prospects in the Grey Oak pipeline will slump from 42.25% to 6.50%.