Kinder Morgan Inc (KMI) Acquires Kinder Morgan Energy Partners LP (KMP) and Two Other Associated Companies in a $44 Billion Deal

Kinder Morgan Inc (NYSE:KMI) recently announced that it will be acquiring  its three associated companies Kinder Morgan Energy Partners LP (NYSE:KMP), El Paso Pipeline Partners, L.P. (NYSE:EPB) and Kinder Morgan Management, LLC (NYSE:KMR) in a $44 billion deal. The total value of the deal would actually come to $71 billion as Kinder Morgan Inc (NYSE:KMI) will also assume $27 billion in debt from these companies, apart from paying about $40 billion in stock and $4 billion in cash to investors in these companies.

Kinder Morgan Energy Partners LP (NYSE:KMP)

David Faber and Jim Cramer discussed the move by Kinder Morgan Inc (NYSE:KMI) to acquire Kinder Morgan Energy Partners LP (NYSE:KMP) and the other two companies in a move to consolidate its vast oil-and-gas pipeline empire into a single company on CNBC.

“He would recognize that these incentive distribution right was kick back money, maybe as much as 40, 50%, some people say 60% of the actual net income going back to the partner Kinder Morgan Inc (NYSE:KMI), that that had been disadvantaging Kinder Morgan to be up on due deals. Even though it had done Copano and it’d done El Paso and the cost of was capital too high for Kinder, a lot of people also felt that it was law of large numbers. Now Rich Kinder’s company does produce as of last year 55,000 barrels of oil in Texas, so its also an oil company, [...] but the essence of this company was that people said, “Rich is letting down people” [...],” Cramer said.

With this deal, Kinder Morgan Inc (NYSE:KMI) will also be renouncing the financial structure that it popularized in the 90′s, the master limited partnerships. The enterprise value of this deal is going to be $140 billion – $100 billion in market value and $40 billion in debt. Cramer feels that this deal of  Kinder Morgan Inc (NYSE:KMI)  acquiring Kinder Morgan Energy Partners LP (NYSE:KMP) and the other two companies, will give it the necessary leverage to go out and buy any company that it wants to.

Disclosure: None

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The Top 10 Most Expensive Digital Cameras to Snap Stunning Shots With

The 10 Highest Quality Fast Food Restaurants In America Today

The 8 Best Halloween Decorating Ideas to Spook Up Your House

10 Marvel Women that Should Get a Movie Right Now

The 20 Best Remixes of Popular Songs that Will Make You Forget the Originals

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

50 Crazy Facts About Japan You Won’t Believe

Top 10 Least Expensive Hybrid Cars to Save the Planet With

The 10 Biggest ‘Gate’ Controversies in History

The 10 States with the Highest Nursing Shortages Leaving Their Hospitals Depleted

The 10 Best Value Investment Blogs that Every Investor Must Read

The 6 Cheapest Boarding Schools in Europe 2015

The 5 Most Expensive Cars To Insure in the World

The 10 Most Common Genetically Modified Foods

10 Self-Made Billionaires Who Came From Nothing

The 10 Most Expensive Cities to Live in North America

The 13 Most Expensive Headphones in the World to Represent

The Top 20 Wealthiest Soccer Teams in 2014

4 BuzzWorthy Cannabis Stocks And Some Smoking Derivative Plays

The 10 Healthiest Fast Food Chains in America to Dine At

The 5 Most Expensive Cat Food Brands You Can Spoil Your Kitty With

The 6 Best eCommerce Platforms for Small Businesses

The 10 Worst Mistakes an Entrepreneur Can Make

The 5 Most OP Characters in League of Legends to Carry Games and Crush Foes With

The 5 Best Foods to Eat Before Running that Will Help You Pound the Pavement

10 Glaring Plot Holes in The Walking Dead that a Zombie-Filled Bus Could Drive Through

The 5 Biggest Celebrity Stoners Who Love Their Reefer

The 10 Most Overrated Movies Of All Time by Out-of-Touch Critics

Top 6 Least Expensive Cruise Destinations For 2015 that Will Take You to Paradise

10 States with Lowest Substance Abuse Rates in America

The 14 Most Watched TV Finales Ever

The 10 Best Selling Role Playing Games of All Time for PC

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

Top 6 Cities For The Ultra Rich to Live in Comfort

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

How to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!