El Paso Corp. (EP) said Wednesday it plans to sell some of its
midstream natural-gas assets to El Paso Pipeline Partners LP
(EPB).
Under the terms of the deal, El Paso Pipeline would buy its
general partner's remaining 14% interest in Colorado Interstate Gas
Co. and acquire all of Cheyenne Plains Investment Co., which serve
the Rocky Mountain region.
El Paso owns a 42% limited partner interest in El Paso Pipeline
as well as the 2% general partner interest that operates the
midstream partnership.
The deal is expected to close contemporaneously with Kinder
Morgan Inc.'s (KMI) acquisition of El Paso and would immediately
add to distributable cash flow.
Kinder Morgan, which transports natural gas and coal, agreed to
buy El Paso in a cash and stock deal valued at $21.1 billion when
announced in October. The acquisition would create North America's
largest natural-gas pipeline operator.
Kinder Morgan last month reached an agreement with the U.S.
Federal Trade Commission to sell several midstream assets to gain
regulatory approval for the merger. Kinder Morgan also agreed to
shed its 50% interest in the Rockies Express Pipeline under that
deal.
Shares of El Paso closed at $29.36 Wednesday and were inactive
after hours. Units of El Paso Pipeline were off 3 cents at $32.99
after hours.
-By Drew FitzGerald, Dow Jones Newswires; 212-416-2909; Andrew.FitzGerald@dowjones.com