DT Midstream (NYSE:DTM) said Tuesday it agreed to acquire a portfolio of three FERC-regulated natural gas transmission pipelines from ONEOK (OKE) for $1.2B in cash.

DT Midstream (DTM) will acquire 100% operating ownership in Guardian Pipeline, Midwestern Gas Transmission and Viking Gas Transmission, with a combined ~1,300 miles across seven states in the Midwest market region with total capacity of more than 3.7B cf/day.

The company said the acquisition directly aligns with its strategy of "owning natural gas assets connecting premier supply basins with key demand centers and market regions, and with revenues supported by take-or-pay contracts with creditworthy and diverse customers."

DT Midstream (DTM) expects the deal will increase its pipeline segment to 70% of adjusted EBITDA in 2025 and increase its backlog of organic growth projects.

The acquired portfolio has a ~90% demand-pull customer base with 85% of revenues from investment-grade customers, the company said.