Kinder Morgan Energy Partners, L.P. (NYSE: KMP) is currently halted after the close. The L.P. has filed plans with the SEC fot an underwritten public secondary offering of some 6,700,000 common units representing limited partner interests. The deal is said to be “pursuant to an effective registration statement” that is on file.
BofA Merrill Lynch, Barclays Capital, Credit Suisse, J.P. Morgan, and Wells Fargo Securities will act as joint book-running managers of the Offering. For a well-known limited partnership, this is a rather large underwriting group.
The Partnership also intends to grant the underwriters of this offering a 30-day overallotment option to purchase up to 1,005,000 additional common units if the orders and price justify it.
As far as the use of proceeds from the larger prospectus supplement, that is to repay commercial paper debt and for general partnership purposes. A filing noted, “As of June 10, 2011, the weighted average interest rate on the commercial paper debt to be retired was approximately 0.337% and our outstanding commercial paper balance was $598 million. Affiliates of several of the underwriters may hold our commercial paper debt and will receive proceeds from this offering.”
These units closed down 0.26% at $72.82 today and the 52-week trading range is $63.15 to $78.00. The market cap for this Limited Partnership is listed as more than $23 billion.
JON C. OGG