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Ten days ago, I wrote an article about what a good growth and income stock Kinder Morgan (NYSE:KMP) has been over the years.

Monday the company announced that it is buying El Paso Corp. (EP) for $21.1 billion, in the biggest transaction in more than a year in the energy sector.

The acquistion of El Paso by Kinder Morgan will create the largest natural gas pipeline network in the U.S. The combined company will have 67,000 miles of gas lines, which will make it bigger than rival Enterprise Products (NYSE:EPD).

CEO Richard Kinder obviously believes strongly that the need for natural gas and the pipelines it flows through will continue to grow.

The question for shareholders (and I am one) is whether this is an acquisition that will continue to increase shareholder value in coming years.

Let's begin by revisiting Kinder Morgan's track record over the last 1, 3, 5, and 10 years. Let's also review Kinder's dividend track record:

Kinder Morgan's Total Return Track Record

Data from Best Stocks Now smart phone app.

Kinder Morgan has been a fantastic growth and income stock over the last decade. As you can see, the stock has outperformed the S&P 500 over the last 1, 3, 5, and 10 years. Along with the steady dividends, it has also delivered very good capital appreciation. Dividends plus growth equals the best of both worlds.

Kinder Morgan has never missed a dividend, and it has increased its dividend every year over the ten years. The current dividend yield on the stock is still 6.1%, even after Monday's big $3.63 per share move to the upside.

Now let's look at the company Kinder is acquiring, El Paso (EP).

As you can see, El Paso has handily beaten the S&P 500 over the last 1, 3, and 5 years. It has not done very over the last ten years, however. It should also be noted that El Paso was down 53.9% in 2008, while Kinder Morgan was only down 9.2.%

Now that El Paso is under the watchful eye of Rich Kinder, I would look for the company to deliver much smoother results, like Kinder has achieved at KMP.

El Paso has also delivered a very spotty track record of dividends. As mentioned above, Kinder Morgan has delivered an almost impeccable track record of dividends. Look for that track record to continue into the future with El Paso now in the capable hands of the Kinder Morgan management team.

El Paso quarterly dividend record:

Aug 31, 2011 0.01 Dividend
Jun 1, 2011 0.01 Dividend
Mar 2, 2011 0.01 Dividend
Dec 1, 2010 0.01 Dividend
Sep 1, 2010 0.01 Dividend
Jun 2, 2010 0.01 Dividend
Mar 3, 2010 0.01 Dividend
Dec 2, 2009 0.01 Dividend
Sep 2, 2009 0.05 Dividend
Jun 3, 2009 0.05 Dividend
Mar 4, 2009 0.05 Dividend
Dec 3, 2008 0.05 Dividend
Sep 3, 2008 0.05 Dividend
Jun 4, 2008 0.04 Dividend
Mar 5, 2008 0.04 Dividend
Dec 5, 2007 0.04 Dividend
Sep 5, 2007 0.04 Dividend
May 30, 2007 0.04 Dividend
Feb 28, 2007 0.04 Dividend
Nov 29, 2006 0.04 Dividend
Aug 30, 2006 0.04 Dividend
May 31, 2006 0.04 Dividend
Mar 1, 2006 0.04 Dividend
Nov 30, 2005 0.04 Dividend
Aug 31, 2005 0.04 Dividend
Jun 1, 2005 0.04 Dividend
Mar 2, 2005 0.04 Dividend
Dec 1, 2004 0.04 Dividend
Sep 1, 2004 0.04 Dividend
Jun 2, 2004 0.04 Dividend
Mar 3, 2004 0.04 Dividend
Dec 3, 2003 0.04 Dividend
Sep 3, 2003 0.04 Dividend
Jun 4, 2003 0.04 Dividend
Mar 5, 2003 0.04 Dividend
Dec 4, 2002 0.218 Dividend
Sep 4, 2002 0.218 Dividend
Jun 5, 2002 0.218 Dividend
Feb 27, 2002 0.218 Dividend
Dec 5, 2001 0.213 Dividend
Sep 5, 2001 0.213 Dividend
May 30, 2001 0.213 Dividend

I would have had no interest at all in buying El Paso stock on its own. I have been extremely happy with the performance of my Kinder Morgan over the years, however. Despite El Paso's spotty record, I feel extremely confident that Richard Kinder can continue to deliver the kind of returns I have gotten used to from KMP.

I am also a believer in the future of natural gas in the U.S. I have no intention of selling my current holdings in Kinder Morgan, and I look for more good things to come from this management team well into the future,

Source: Kinder Morgan's El Paso Acquisition Is A Smart Move