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Kinder Morgan (KMI) will purchase El Paso Corp. (EP) in a $38B deal of cash, stock, and...

Kinder Morgan (KMI) will purchase El Paso Corp. (EP) in a $38B deal of cash, stock, and assumption of debt. The price - based on KMI's Friday close - works out to $26.87/share, a 37% premium over El Paso's last trade. KMI CEO Rich Kinder expects the transaction to be immediately accretive to the company's earnings. (PR)
Comments (12)
  • Uncle Pie
    , contributor
    Comments (2924) | Send Message
     
    nice going, Seeking Alpha! This is a huge transaction, and 20 minutes since you posted this report, neither Bloomberg nor Reuters has picked it up yet.
    16 Oct 2011, 03:13 PM Reply Like
  • Ocean Man
    , contributor
    Comments (538) | Send Message
     
    Holy schnikes! That's a large acquisition.
    16 Oct 2011, 05:13 PM Reply Like
  • buyitcheap
    , contributor
    Comments (1890) | Send Message
     
    It lives in a van down by the river.
    16 Oct 2011, 10:12 PM Reply Like
  • Hendershott
    , contributor
    Comments (1541) | Send Message
     
    Don't know the group well but are there implications for ETP and other MLP's that get drop downs from the parent companies?
    16 Oct 2011, 05:23 PM Reply Like
  • bigbenorr
    , contributor
    Comments (764) | Send Message
     
    So will EPB be rolled into KMP? or simply be another part of KMI?
    16 Oct 2011, 05:43 PM Reply Like
  • jlmanfred
    , contributor
    Comments (95) | Send Message
     
    If I remember correctly EP owns a large share of EPB ... maybe as much as 38% or more. Therefore, KMI will need to conserve the value of EBP one way or another. Most likely in combination with KMP??
    16 Oct 2011, 06:11 PM Reply Like
  • bigbenorr
    , contributor
    Comments (764) | Send Message
     
    They have such a confusing corporate structure....

     

    here is the quote from their website: "KMI also intends to sell (drop down) all of EP's natural gas pipeline assets to KMP and EPB over the next few years. Each of these transactions will be subject to approval by KMP's or EPB's independent directors, who are expected to obtain independent advisors to assist them in their analysis." That sort of clears it up I guess
    16 Oct 2011, 08:17 PM Reply Like
  • Stone Fox Capital
    , contributor
    Comments (6065) | Send Message
     
    emphatic answer to whether this is a repeat of 2008. NO!
    16 Oct 2011, 06:25 PM Reply Like
  • Charles A. Smith
    , contributor
    Comments (1106) | Send Message
     
    Tennessee Gas pipeline is a hugely undervalued asset for EP; minimal capex necessary to increase volumes in this line by 2X or 3X over the next 5 years...nearly pure profit. Runs right through the heart of Marcellus and Utica formations.
    16 Oct 2011, 06:59 PM Reply Like
  • TruffelPig
    , contributor
    Comments (4078) | Send Message
     
    What the EP share holders say to 37% premium? Happy? Seems a bit low. EP gained from 14 to ca. 20 during the last year.
    16 Oct 2011, 07:23 PM Reply Like
  • Hillbilly Stock Star
    , contributor
    Comments (732) | Send Message
     
    Long Both EP & EPB as valuation call, check out OKE looks like they have a loaded gun! Long.
    16 Oct 2011, 07:44 PM Reply Like
  • Donald Johnson
    , contributor
    Comments (462) | Send Message
     
    I'm looking for speculation on the impact of the transaction on KMP, KMR and KMI stock prices and future dividends.
    17 Oct 2011, 12:08 AM Reply Like
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