Kinder Morgan Inc. (NYSE: KMI) is supposed to price tonight.  While many already expected the IPO to be hot, the talk is that hot became hotter.  The last formal count was 80 million shares at a price of $26 to $29 per share.  The chatter has been out that some 90 million shares may be closer to the offering and the price is expected to be at the top of the range.

This has been one of our Top 17 IPOs to Watch in 2011 and there may be a halo-effect for shares of “the other Kinder Morgans’ via Kinder Morgan Energy Partners LP (NYSE: KMP) and Kinder Morgan Management LLC (NYSE: KMR).  Selling shareholders include entities under or affiliated with Goldman Sachs Group Inc. (NYSE: GS), Highstar Capital LP, The Carlyle Group and Riverstone Holdings LLC.  The common stock offered will represent an approximately 11.3% interest in the newly named Kinder Morgan, Inc., or approximately 13.0% if the underwriters exercise their over-allotment option.

Richard Kinder’s success speaks for itself with exponential gains.  While investors should be concerned on the surface that all of the common stock being sold will be sold by existing investors, no members of Kinder Morgan management are selling in the offering.

Goldman Sachs and Barclays Capital were selected as the final joint book-running managers; co-managers are listed as BofA Merrill Lynch, Citi, Credit Suisse, Deutsche Bank, J.P. Morgan, Wells Fargo, Madison Williams, Morgan Keegan, Raymond James, RBC Capital Markets, and Simmons & Company International.  The selling stockholders will grant the underwriters a 30-day option to purchase up to 12,000,000 additional shares of common stock.

Watch for this IPO tomorrow.  There is one thing to consider here that is a sad reality of such a large offering.  Some of the other unrelated MLPs are up massively from lows and some of these could see selling as money comes off the table for the Kinder IPO.

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JON C. OGG

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