A leading master limited partnership,
Williams Partners L.P.
) recently announced a public offering of 11,250,000 common units
to increase its liquidity. The partnership also offered a 30-day
option to the underwriters to purchase 1,687,500 additional
units. The units were priced at $ 49.14 a piece.
Additionally, Williams Partners decided to sell 3,000,000 of its
common units in a private placement to
Williams Companies Inc.
) - its general partner. The unit price will be same as above,
less the underwriting discount and commissions.
The offering is expected to close on Mar 8, 2013. Upon closure,
Williams Companies will own 68% of Williams Partners, together
with the general-partner interest.
The partnership intends to use the entire proceeds to pay off the
outstanding balance under the partnership's credit facility. The
borrowings were used for capital expenditures, working capital,
partnership distributions and other partnership purposes.
Williams Partners currently retains a Zacks Rank #5 (Strong
Sell), implying that it is expected to underperform the broader
U.S. equity market over the next 1 to 3 months.
Williams Partners is an energy master limited partnership engaged
in gathering, transportation, treating and processing of natural
gas as well as fractionation and storage of natural gas liquids.
Last month, the partnership registered fourth-quarter 2012
earnings of 42 cents per limited-partner unit, missing the Zacks
Consensus Estimate of 52 cents. Lower NGL margins in the
partnership's business during the quarter led to the
However, there are other stocks in the oil and gas sector -
Calumet Specialty Products Partners L.P.
Compressco Partners L.P.
) - which hold a Zacks Rank #1 (Strong Buy) and are expected to
CALUMET SPECLTY (CLMT): Free Stock Analysis
COMPRESSCO PTNR (GSJK): Free Stock Analysis
WILLIAMS COS (WMB): Free Stock Analysis
WILLIAMS PTNRS (WPZ): Free Stock Analysis
To read this article on Zacks.com click here.