GasLog Partners LP (NYSE:GLOP), a spinoff of GasLog, formed to own and operate liquefied natural gas (LNG) carriers, had a hugely successful IPO on Tuesday soaring from $21.00 to $26.11.
The IPO was priced at $21 per share which was above the proposed price range of $18 to $20. GLOP now commands a market value of over $500 million.
GLOP filed on April 7, 2014.
Lead Underwriters: Citigroup Global Markets, Inc., Credit Suisse Securities LLC, Wells Fargo Securities LLC
Underwriters: Barclays Capital, Inc., Deutsche Bank Securities, Inc., DNB Markets, Inc., Evercore Group LLC, UBS Investment Bank
Overview of Operations: Carrying Liquefied Natural Gas
GLOP is a limited partnership, formed to acquire and operate liquefied natural gas carriers, and specifically seeks to own carriers engaged under charters of five years or more. The firm's initial fleet will consist of a trio of ships, acquired through GasLog, which owns GLOP's general partner and will effectively control the firm.
GLOP plans to continue to expand its fleet, and may acquire more ships through GasLog or from other sources; the firm will have the option to purchase twelve additional LNG carriers through GasLog within 36 months after each vessel's acceptance by its charterer or 36 months after this IPO.
GLOP hopes to take advantage of increasing global demand for LNGs and LNG transportation, and to leverage GasLog's existing relationships and reputation to establish its fleet and to secure desirable charters.
GLOP offers the following figures in its F-1 balance sheet for the year ended December 31, 2013:
Net Income: $26,218,242.00
Total Assets: $581,770,092.00
Total Liabilities: $425,601,142.00
Stockholders' Equity: $156,168,950.00
GLOP will face competition for charters, personnel and ships from other LNG carrier owners, some of which have access to greater financial resources than GLOP.
Former Goldman Executive To Become GLOP CEO
Andrew J. Orekar will become CEO of GLOP with the closing of this IPO. Mr. Orekar previously served as Managing Director and Global Head of Chemicals and Agriculture Investment Banking with Goldman Sachs & Co, where he spent the past fifteen years of his career.
Mr. Orekar holds a B.S. in Finance and a B.A. in English from the University of Pennsylvania.
We are optimistic on the future of this company and rate GLOP a buy.
GLOP stands to benefit substantially from its relationship with GasLog, which should allow the firm excellent access to charters and personnel.
The high barriers to entry for potential new competitors should also help GLOP to establish its fleet and to secure the long-term charters it seeks.
Increasing global demand for LNG carriers will provide a wealth of opportunities for GLOP moving forward.
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