The Pipeline Industry witnessed a sudden incoming investment stream with Richard Kinder planning to take over some of the rival pipeline operators. With a huge sum of $71 billion for buyouts, Kinder is targeting rivals for the consolidation under Kinder Morgan Inc (NYSE:KMI). When asked about the move Richard Kinder said, “I think it’s a fertile field to do a little grazing.”
One of the primary reasons behind this acquisition trend is the booming shale formation market throughout the North America with an increasing demand of storage terminals, pipelines, and supporting infrastructure. Targa Resources Corp (NYSE:TRGP) and Markwest Energy Partners LP (NYSE:MWE) are the next potential buyout candidates in the acquisition campaign.
Targa Resources Corp (NYSE:TRGP) and Targa Resources Partners LP (NYSE:NGLS) collectively work under the Targa Resources Partners banner. The group released its second quarter 2014 earnings on August 1 2014. The net income of the partnership for second quarter 2014 was $109 million as compared to the earnings of $26 million for the same quarter last year. Income per share for the partnership was $0.64, which was much better than the EPS of $0.01 in the second quarter of 2013. Adjusted EBITDA for this quarter was $226.4 million as compared to the second quarter-adjusted EBITDA of 126.5 million in 2013.
Markwest Energy Partners LP (NYSE:MWE) is among the next buyout targets of Richard Kinder. The company reported a net adjust EBITDA of $208 million for the second quarter of 2014 as compared to the $156 million of the second quarter in 2013. The company announced distributable cash flow of $162 million for the second quarter and its discounted cash flow raised to $310 million for the last six months ending on 30 June 2014. Markwest Energy Partners LP (NYSE:MWE) has a market cap of $12.2 billion and dividend yield of 5.1%. The company has more than 1, 139 full time employees.
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This article has been written by Prakash Pandey and edited by Serkan Unal.
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