- Financial Times appreciates the creativity Linn Energy (LINE, LNCO) is showing in trying to maintain its payout to investors, potentially finding a way to keep growing so the company can support and expand its dividend at a time when preserving cash is paramount.
- In January, Linn cut its dividend by more than 50% but also announced a financing joint venture with a P-E firm which would fund $500M in drilling costs in exchange for getting a preferred return, and in March, it unveiled a $1B vehicle with another firm to fund acquisitions of oil and gas acreage; today, Linn finally closed those deals, allaying concerns that they may not get completed.
- Cash flow did not cover Linn's dividend in Q1, and fears of a repeat have persisted, but if the MLP has found a way to withstand the oil rout, look for its yield to normalize, not because its dividend will be cut, but because its share price will rise, FT writes.