JP Energy Partners LP (NYSE: JPEP) units bounced up 10% in early trading Oct. 24 following the announcement of its $2 billion all-stock acquisition by American Midstream Partners (NYSE: AMID).
Denver-based American Midstream was No. 45 on Hart Energy’s The Midstream 50 ranking, based on 2015 EBITDA. JP Energy Partners was No. 48. After closing, the combined entity, to be based in Houston, expects an EBITDA of about $185 million. That would place it at No. 37 on the list.
“This is not just a transformative event, it’s an evolutionary change,” Lynn Bourdon III, American Midstream’s chairman, president and CEO, said during an Oct. 24 conference call to discuss the deal. “The increased scale of the combined partnership expands the opportunity set of initiatives we are able to competitively consider in order to achieve continued growth well into the future.”