Master limited partnerships (MLPs) outperformed equity and credit benchmarks in April, with the Alerian eking out a gain of 1.68% while the S&P 500 fell 0.7%. MLPs involved in natural gas storage and coal led the group with near double digit gains after having been the chief laggards of all the MLP subsectors for the past several months. Propane MLPs, another recent underperforming sub-industry, also rebounded on support from Suburban Propane Partners LP’s proposed acquisition of Inergy LP’s retail propane business for $1.8 billion. In other deal news, Penn Virginia Resource Partners LP’s announced acquisition of Chief Gathering LLC’s midstream assets for $1.0 billion was the latest example of consolidation focused around the Marcellus shale.
The largest of the recent MLP deals was Energy Transfer Partners LP’s (ETP) agreement to purchase Sunoco, Inc. (SUN), in a cash and units transaction valued at $50.13 per share, reflecting a 29% premium to SUN’s 20-day average price. ETP’s acquisition of SUN, which is not an MLP, comes on the heels of Energy Transfer Equity’s (ETE) purchase of Southern Union and Kinder Morgan’s planned purchase of El Paso Corp, reflecting a trend of large MLPs acquiring c-corporations.
For the full article, please contact Tamar Essner at Tamar.Essner@thomsonreuters.com
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