Kinder Morgan (KMI -0.9%) confirms that shareholders and unitholders at KMI, Kinder Morgan Partners (NYSE:KMP), Kinder Morgan Management (NYSE:KMR) and El Paso Pipeline (NYSE:EPB) approved all proposals related to bringing all four pipeline companies under one roof.
KMI also projects a 16% dividend increase to $2/share for 2015, and expects to grow the dividend by ~10%/year during 2015-20 while producing excess coverage of more than $2B.
Consolidating its oil-and-gas pipeline empire into a single company, Kinder Morgan (NYSE:KMI) will purchase Kinder Morgan Energy Partners (NYSE:KMP), Kinder Morgan Management (NYSE:KMR), and El Paso Pipeline Partners (NYSE:EPB).
The MLP structure is limiting, says Richard Kinder. Combining the four companies into one unit "will allow us to further expand the reach of the kind of projects we can do."
KMP unitholders will receive 2.1931 KMI shares and $10.77 in cash for each KMP unit, or $89.98, a 12% premium to Friday's close (based on KMI's Friday close).
KMR shareholders will receive 2.4849 KMI share for each share of KMR, or $89.75, a 16.5% premium to Friday's close (based on KMI's Friday close).
EPB unitholders will receive .9451 KMI shares and $4.65 in cash for each EPB unit, or $38.79, a 15.4% premium to Friday's close (based on KMI's Friday close).
In conjunction with the deal, KMI expects a $2 annual dividend in 2015, a 16% boost to 2014's anticipated payout. The dividend is expected to grow about 10% per year through 2020.