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Energy

Plains All American Taking IPO Spin-off Route (PAA)

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By Douglas A. McIntyre Updated Published
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Plains All American Pipeline, L.P. (NYSE: PAA) is pursuing a spin-off strategy which we have seen elsewhere in the energy patch, but it is a strategy that we saw mostly in 2008.   The group announced that it plans to have an IPO of common units representing limited partner interests of PAA Natural Gas Storage, L.P.  This is its master limited partnership subsidiary to be formed by PAA to own and operate its natural gas storage assets and business.

The group said in the press release that it expects to file a registration statement for the IPO with the SEC during the first quarter of 2010.   PAA will own the 2% general partner interest and incentive distribution rights of PNGS.  It also expects to retain a substantial portion of the MLP’s common and subordinated units. PAA anticipates using the proceeds of the IPO to repay debt and for general partnership purposes.

Plains has a current market capitalization rate of some $7.3 billion and shares are up 0.55% at $53.81 right after the open of the market.  The 52-week trading range is $34.00 to $54.96.

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JON C. OGG

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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