By Tess Stynes
Enbridge Energy Partners L.P. (EEP) said it intends to file
plans to spinoff some of its natural gas and natural gas midstream
assets in an initial public offering, joining a stream of companies
forming master limited partnerships in the sector.
Enbridge Energy expects that the proposed MLP--Midcoast Energy
Partners LP--will sell a minority of its limited partner interests
in the offering and raise gross equity proceeds of $400 million to
$500 million. Further financial terms of the offer weren't
provided.
Enbridge Energy said it expects to file initial plans with the
U.S. Securities and Exchange Commission during the second
quarter.
The company said the proposed MLP's expected initial asset will
consist of a roughly 40% ownership stake in Enbridge Energy
Partners' existing natural gas and midstream business.
Enbridge Energy expects the IPO will enhance the company's
access to capital by providing an alternative source of funding for
its liquids pipelines growth projects through the intended drop
down of Enbridge Energy's remaining ownership interests in the
natural gas and NGL midstream business to the MLP over the next
four to five years.
The company also expects the move will position it to accept
future drop downs of liquids pipeline assets from Enbridge Inc.
(ENB, ENB.T), as well as increase Enbridge Energy's focus on its
crude oil midstream business.
Enbridge Energy's common units were down three cents at $29.23
in light after-hours trading.
Write to Tess Stynes at Tess.Stynes@dowjones.com
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