Marathon Petroleum Corp (MPC) Jumps On MPLX LP (MPLX) Acquisition of Markwest Energy Partners LP (MWE)

Shares of Marathon Petroleum Corp (NYSE:MPC) rose as high as 10.81%, after its sponsored Master Limited Partnership (MLP) MPLX LP (NYSE:MPLX) announced that it will acquire Markwest Energy Partners LP (NYSE:MWE) in a deal which is expected to result in the formation of the fourth-largest American MLP with a $21 billion market capitalization. MPC will contribute $675 million in cash, as part of the deal, which involves paying MWE shareholders 1.09 shares of MPLX and a $3.37 in cash per share. In return, the resulting firm which will have Markwest as a fully-owned subsidiary, will have significantly more assets in the midstream component of the natural gas industry. “This combination is a significant step in executing MPC’s strategy to grow its higher-valued, stable cash flow midstream business, by transforming MPLX into a large-cap, diversified master limited partnership,” MPC President and Chief Executive Officer Gary R. Heminger said in a statement.

Marathon Petroleum Corp (MPC), NYSE:MPC,

It’s important to note, however, that the upbeat outlook of Marathon Petroleum Corp (NYSE:MPC) on the MPLX LP (NYSE:MPLX) and Markwest Energy Partners LP (NYSE:MWE) merger is opposed to the hedge fund sentiment on MPC by the end of the first quarter. Though 46 hedge funds tracked by Insider Monkey held long positions in MPC by March 31, up by 2% from one quarter earlier, the total holdings value decreased by 4.93% to $2.89 billion. This is despite the stock gaining 13.45% in the first quarter.

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Insider Monkey also follows insider transactions to see whether insiders are bullish on a company. In this way, Steven Davis, director at Marathon Petroleum Corp acquired 3,500 shares of the firm on March 13, but Senior Vice President Pamela Beall disposed of 26,673 shares on June 2. Considering these, let’s appraise the fresh activity concerning Marathon Petroleum Corp.