The acquisition will unite the two closely-linked pipeline operators, which are themselves controlled by a general partnership company owned by Houston billionaire Dan Duncan. Under terms of the deal, Teppco shareholders will receive 1.24 Enterprise shares, valued at $US31.36 each, for each of their Teppco shares, representing a 9.3 per cent premium over Teppco's closing price at the end of June. The deal is valued at about $US500 million more than the $US2.8 billion cash-and-stock deal Enterprise first offered in March, and which was later rejected by Teppco's management as being too low.

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The agreement brings Teppco officially into the Enterprise family, allowing the company to benefit from Enterprise's stronger balance sheet and more stable yield payout. Enterprise gains by acquiring a more diverse mix of products and shipping routes via Teppco's extensive oil products network. The combined partnership will control a significant amount of midstream energy assets, including 76,800 km of pipeline; 200 MMbbl of natural gas liquids, refined product, and crude oil storage capacity; 27 Bcf of gas storage capacity; 60 product terminals; and the largest inland tank barge companies in the United States.