By Lisa Kerner
Charlotte, N.C., June 29 - Enterprise Products Partners LP and Teppco Partners LP said they agreed to merge to form the largest publicly traded energy partnership in a deal valued at $3.3 billion.
The combined company will retain the name Enterprise Products Partners and will own almost 48,000 miles of natural gas and oil pipelines.
Under the companies' agreement, Teppco unitholders will receive 1.24 Enterprise common units for each Teppco unit, according to a form 8-K filed with the Securities and Exchange Commission.
Enterprise and Teppco are operated by general partners owned by Enterprise GP Holdings LP, which is owned by Dan Duncan.
Duncan will be chairman of the combined company, the filing said.
The transaction is expected to close in the fourth quarter subject to unitholder approval.
"We are excited to announce this merger, which will establish Enterprise as the largest pipeline partnership as measured by miles of pipe, enterprise value and equity market capitalization," Enterprise president and chief executive officer Michael A. Creel said in a news release.
"We also believe the size, financial stability and liquidity of the combined company will appeal to our customers and our debt and equity investors," Creel said.
In April, Texas Eastern Products Pipeline, LLC, the general partner of Teppco, rejected Enterprise's offer to acquire the outstanding partnership interests of Teppco, a Houston-based pipeline operator, for 1.043 Enterprise common units plus $1 in cash for each Teppco common unit.
Enterprise is a Houston-based provider of processing, transportation and storage services to the natural gas, natural gas liquids and crude oil industries.
| Acquirer: | Enterprise Products Partners LP
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| Target: | Teppco Partners LP
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| Announcement date: | June 29
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| Expected closing: | Fourth quarter of 2009
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| Unit price of acquirer: | NYSE: EPD: $25.29 on June 26
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| Unit price of target: | NYSE: TPP: $28.69 on June 26
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