A leading master limited partnership (MLP), Energy
Transfer Partners L.P. ( ETP ) recently
announced the pricing of a public offering of 12,000,000 common
units. The partnership also offered a 30-day option to the
underwriters to purchase 1,800,000 additional units. The units were
priced at $48.05 a piece.DELEK LOGISTICS (DKL): Free Stock Analysis
ReportENERGY TRAN PTR (ETP): Free Stock Analysis
ReportSUMMIT MIDSTRM (SMLP): Free Stock Analysis
ReportSUNOCO LOGISTIC (SXL): Free Stock Analysis
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Energy Transfer intends to use the entire proceeds to pay off the
outstanding balance under its credit facility and other partnership
purposes. The partnership expects the proceedings to be over on Apr
Energy Transfer ended fourth quarter 2012 with long-term debt
(less current maturities) of $15,442 million.
Debt-to-capitalization ratio was 47.1%.
The partnership currently retains a Zacks Rank #3 (Hold), implying
that it is expected to perform in line with the broader U.S. equity
market over the next 1 to 3 months.
In Oct 2012, Energy Transfer acquired Philadelphia-based refining
and petroleum product marketing company Sunoco Inc. for $5.3
billion. With this transaction, Energy Transfer has also become the
General Partner and the owner of a 32.4% interest in Sunoco
Logistics Partners L.P. ( SXL ), an MLP that
operates substantial refined product and crude oil pipeline and
We believe Energy Transfer is well positioned to compete in the
natural gas midstream, and transportation & storage businesses
with its geographically dispersed asset mix. The partnership has a
significant market presence in each of its operating areas, which
are located in the major natural gas-producing regions of the
However, MLPs typically depend on equity and debt markets for
growth finance. Market turmoil resulting from issues such as the
recent subprime crisis, which hinders access to debt/equity
markets, will impact MLP growth prospects.
Meanwhile, there are other pipeline operators that offer more
value and are worth buying now. These include Delek
Logistics Partners L.P. ( DKL ) and
Summit Midstream Partners L.P. ( SMLP ). Both these
firms sport a Zacks Rank #2 (Buy).