Two More MLP GPs Leave the Market
Two additional publicly traded MLP general partners, Buckeye GP Holdings, L.P. and Enterprise GP Holdings L.P., have completed their previously announced merger transactions and their units withdrawn from the New York Stock Exchange. The latest mergers reduces the number of publicly traded MLP GPs from a high of ten to five.
On November 16, 2010 Buckeye Partners, L.P. (BPL) and Buckeye GP Holdings (BGH) announced that their respective shareholders had approved their proposed merger, which was announced on June 11. 99% of voting BGH unitholders and 96% of voting BPL unitholders voted in favor of approval.
Under the terms of the merger agreement, each BGH common and management unit was converted into the right to receive 0.705 BPL units, BGH's incentive distribution rights were cancelled, and BGH was merged into BPL when the merger closed on November 19. BGH units were suspended from trading before the opening of the market on November 22.
Enterprise GP Holdings (EPE) and Enterprise Products Partners L.P. (EPD) announced on November 22 that their proposed merger, announced on September 7, 2010, had been approved by 99% of those voting. The merger was completed later the same day. Under the terms of the merger agreement, EPE unitholders became entitled at the close of the merger to receive 1.50 EPD common units for each EPE unit owned at the effective time of the merger, with cash paid in lieu of any fractional units. Based on the cash distributions paid in November 2010 by EPE and EPD, this will result in a 52% increase in cash distributions for the EPE unitholders.
Also occurring at the close was the cancellation of the 2% economic general partner interest in EPD and the general partner incentive distribution rights. In connection with the merger closing, an affiliate of EPCO agreed to waive the distributions that it would otherwise have been entitled to receive on certain EPD common units for the next five years. Finally, EPE was merged into a wholly-owned subsidiary of EPD, and its common units were delisted from the stock exchange before the opening of the market on November 23rd. The surviving entity will continue to hold a non-controlling interest in Energy Transfer Equity, L.P. (ETE). ETE's general partner, ETE Holdings LLC, has become the successor general partner of EPD and has been renamed Enterprise Products Holdings LLC.
The five remaining MLP GPs which trade as MLPs themselves are Alliance Holdings GP, L.P. (AHGP), Atlas Pipeline Holdings, L.P. (AHD), Energy Transfer Equity, L.P, (ETE), NuStar GP Holdings, LLC (NSH), and Penn Virginia GP Holdings, L.P. (PVG). The Penn Virginia MLPs announced on September 21 their intention to undertake a merger similar to the Buckeye and Enterprise transactions.
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