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Tallgrass Energy Partners: A Dropdown Driven Story

In this essay, I will be discussing Tallgrass Energy Partners (NYSE:TEP), a growth-oriented Delaware based MLP.

The Story So Far

This midstream partnership was formed by Tallgrass Development to own, operate, acquire and develop midstream energy assets in North America. TEP provides i) natural gas transportation and storage services in the Rocky Mountain and Midwest regions through its TIGT System and ii) processing services in Wyoming through Midstream Facilities. For the year ended December 31, 2012, TEP generated Adjusted EBITDA of ~$76.4 mn and net income of ~ $50.1 mn. The company acquired its portfolio of current midstream energy assets from Kinder Morgan (NYSE:KMI) at an enterprise value of ~$3.3 bn in November 2012.

What are

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