As a result of strong interest and cheap capital, MLPs have flooded the market. Now, in the midst of one of the busiest periods of IPO activity since 2007, it can be hard keeping all these MLPs straight. Today I’m breaking out all the recent announcements so we know exactly what’s out there.
Hot off the press
On Tuesday morning, Plains All American Pipeline announced that it plans to take its general partner public as a master limited partnership trading under the ticker symbol PAGP. Plains is planning to raise $1 billion in the offering.
General partners typically own a 2% interest in the MLP, and also receive incentive distribution rights. In return, the general partner manages operations and maintenance at the MLP. It is not unheard of for a general partner to trade publicly; there are at least seven on the market right now, including Atlas Energy and Kinder Morgan.
Plenty more where that came from
Plains’ press release was one of a handful of MLP IPO announcements hitting the wire this summer. Western Refining, Inc. (NYSE:WNR) has also announced that it will pursue an MLP spin-off of its logistics assets. The MLP, appropriately named Western Refining, Inc. (NYSE:WNR) Logistics, will trade under the ticker WNRL. The partnership aims to raise $287.5 million in its offering.
QEP Midstream Partners recently increased its offering from $400 million to $483 million, shares were scheduled to begin trading on Aug. 2 under the ticker QEPM. OCI Resources also priced an IPO in July; it hopes to raise $115 million in its offering.
Additionally, Devon Energy Corp (NYSE:DVN) announced that it is moving forward with its plans to publicly offer its midstream assets, which includes 6,500 miles of pipeline and eight processing plants. Enbridge Energy Partners, L.P. (NYSE:EEP) is also moving forward with an IPO spin-off, with plans to bring Midcoast Energy Partners public, putting $570 million in limited partner units on the market.
Had enough? I’ve got one more for you, and it’s a good one. Last week, big-time refiner Valero Energy Corporation (NYSE:VLO) reaffirmed its intent to throw its hat in the ring as well, potentially spinning off its logistics assets in an MLP sometime next year.
MLP fever
Investors officially need a list to keep track of all of these MLP wheelings and dealings. Perhaps it can be kept in the same cool dry place as this list, which shows every master limited partnership IPO this year:
| MLP | IPO Date |
|---|---|
| Marlin Midstream | July 26 |
| Phillip 66 Partners | July 23 |
| Tallgrass Energy Partners | May 14 |
| Emerge Energy Services | May 9 |
| KNOT Offshore Partners | April 10 |
| New Source Energy Partners | Feb. 8 |
| NuStar Logistics | Jan. 29 |
| SunCoke Energy Partners | Jan. 18 |
| CVR Refining | Jan. 17 |
| USA Compression Partners | Jan. 15 |
Source: NYSE
Phillips 66 Partners had the best IPO of the lot, but with the exception of NuStar Logistics, all of these MLPs are up year to date. The first two, CVR Refining and USA Compression, are up more than 15%.
Bottom line
Investors craving yield and distribution income are certainly not short of opportunities here. As these MLPs continue to flood the market, due diligence becomes increasingly more important. Not all MLPs are created equal.
The article Yield Investors’ Choices Have Skyrocketed in 2013 originally appeared on Fool.com and is written by Aimee Duffy.
Fool contributor Aimee Duffy has no position in any stocks mentioned. The Motley Fool owns shares of Devon Energy and Western Refining.
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