Oil and gas midstream master limited partnership (MLP) Enbridge Energy Partners L.P. (NYSE: EEP) has filed a registration statement with the U.S. Securities and Exchange Commission for an initial public offering (IPO) of Midcoast Energy Partners L.P. Midcoast’s initial assets will consist of a 40% ownership interest in Enbridge’s existing natural gas and natural gas liquids (NGLs) midstream business.
Enbridge Energy Partners will retain ownership of Midcoast’s general partner and all incentive distribution rights. Midcoast will offer a minority share of its total limited partner interests at the IPO. The new company expects to raise $400 million to $500 million in the offering. Proceeds will be used to pay Enbridge for Midcoast’s assets.
The IPO is expected to occur in the second quarter of 2013, which means that it should occur fairly quickly. Enbridge intends to convey all its natural gas and NGL pipeline assets to Midcoast over the next four or five years in a series of “drop-down” transactions. Enbridge will retain all its crude oil pipeline and gathering systems.
Enbridge Inc. (NYSE: ENB) owns the general partner interest in Enbridge Energy Partners and about 27% of the limited partner interest.
Shares of Enbridge Energy Partners are up about 1.7% today, at $29.77 in a 52-week range of $26.88 to $31.17.