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IPO Report: Plains GP Holdings, L.P. (PAGP)

By  +Follow October 14, 2013 6:43PM
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Plains GP Holdings, L.P. (PAGP) is an Incentive Distribution Rights (see below) carve-out from the parent, Plains All American Pipeline, L.P (PAA), which has a $17.5 billion market cap.

Five IPOs are scheduled for this week. The full IPO calendar can be found at IPOpremium.

PAGP is based in Houston, Texas, Plains GP Holdings, L.P. (PAGP) scheduled a $3 billion IPO at a price range mid-point of $23.50, for Thursday, October 17, 2013.

The S-1 was filed October 7, 2013.  Manager, Joint Managers:  Barclays; Goldman;  J.P. Morgan; BofA Merrill; Citigroup; UBS;  Wells Fargo.   Co-Managers:  Baird; Oppenheimer; Stifel; BBVA; BNP PARIBAS; DNB Markets; ING; Mitsubishi UFJ;  Mizuho; Piper Jaffray; PNC; Scotiabank-Howard Weil; SMBC Nikko; SOCIETE GENERALE; SunTrust Robinson; BB&T; CIBC; Ladenburg Thalmann; Regions; Simmons; Stephens; Tudor

Summary

PAGP is an Incentive Distribution Rights (see below) carve-out from the parent, Plains All American Pipeline, L.P (PAA), which has a $17.5 billion market cap.

The yield on the parent PAA is currently 4.7%.  The projected yield for PAGP (the public portion of PAA’s Incentive Distribution Rights) is 2.5%, which will increase if PAA’s growth continues.

Valuation

Valuation Ratios

IPO Mrkt

Price /

Price /

Price /

Dividend

12 months ended 6/13

Cap (mm)

Sls

Erngs

BkVlue

Yield

Plains GP Holdings, L.P. (PAGP)

$14,241

n/a

n/a

n/a

2.5%

Plains All American Pipeline, L.P. (PAA)

$17,500

0.4

10.7

19.4

4.7%

Glossary

Conclusion

The current rating on PAGP is positive.  PAPG is a big IPO and we don’t see much downside risk.  Because of expected Quantitative Easing from the Fed interest rates should stay low, which is a positive for PAPG.  As long as the market is stable at least, PAPG should be bought on the IPO, with moderate to low expectations.

Business

PAGP’s parent — Plains All American Pipeline, L.P. (PAA) with $17.5 billion market cap — is carving out its Incentive Distribution Rights (IDRs).  

Plains All American Pipeline, L.P. (Plains) is engaged in the transportation, storage, terminalling and marketing of crude oil and refined products, as well as in the processing, transportation, fractionation, storage and marketing of natural gas liquids (NGL)

21% of the IDRs are being offered on the IPO, as Class A stock.  The only asset of PAGP is its 128 million shares of class A common stock in the Identive Distribution Rights vehicle, PAGP.

See organization chart here

Incentive distribution rights (IDRs)

IDRs are the risky frosting on the distribution cake  and only get paid if minimum distributions are exceeded by the parent: IDR payments are explicitly tied to distribution growth of the parent.

The yield on the parent PAA is currently 4.7%.  The projected yield for PAGP (the public portion of PAA’s Incentive Distribution Rights) is 2.5%, which will increase if PAA’s growth continues.

PAA’s IDRs and its indirect interest in PAA’s 2% general partner interest entitles PAGP’s stockholders to receive (through several corporate vehicles, see organziationchart)  without duplication:

    •15% of all cash distributed in a quarter after $0.2250 has been distributed in respect of each common unit of PAA for that quarter;

    •25% of all cash distributed in a quarter after $0.2475 has been distributed in respect of each common unit of PAA for that quarter; and

    •50% of all cash distributed in a quarter after $0.3375 has been distributed in respect of each common unit of PAA for that quarter.

PAGP owns 21% of the incentive distribution rights from the parent, PAA, through several corporate vehicles.

5% stockholder pre-IPO

“Existing Owners” refer to the entities and individuals that own capital interests in AAP and GP LLC  including, but not limited to, PAA Management, L.P. (“PAA Management”) and certain entities and individuals affiliated with Occidental Petroleum Corporation (“Oxy”), The Energy & Minerals Group (“EMG”), and Kayne Anderson Investment Management Inc (“Kayne Anderson”).

See organization chart here

Use of proceeds

PAGP will distribute the expected IPO proceeds of $2.9 billion to distribute to the Existing Owners, see above.

 

 


 

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Results for pagp
Wendy Berrington
1 Aug 15 15:34:45
RT @ameystone: JPMorgan: 4 Quality Oversold MLPs: $PAA, $PAGP, $ETP, $SUN http://t.co/L26TziOV1A via @barronsonline
CRWE News Wire
1 Aug 15 13:22:20
Upcoming Profit and Loss Reports in Focus $SMG, $WLK, $PAA, $PAGP, $HCA, $VOYA, $SLF, $CTL, $MFC, $CORE http://t.co/UArZJUR2YS
Penny Omega
1 Aug 15 12:09:23
Upcoming Profit and Loss Reports in Focus $SMG, $WLK, $PAA, $PAGP, $HCA, $VOYA, $SLF, $CTL, $MFC, $CORE http://t.co/ME5QKILptq
Debby Gerald
1 Aug 15 04:34:55
J.P. Morgan's top oversold high-quality MLPs: PAA, PAGP, ETP, SUN $PAA $PAGP $ETP $SUN $VLP $PSXP $NS $MIC http://t.co/gbwOMnAdOK
pennyomega CRWE
1 Aug 15 04:07:11
Upcoming Profit and Loss Reports in Focus $SMG, $WLK, $PAA, $PAGP, $HCA, $VOYA, $SLF, $CTL, $MFC, $CORE http://t.co/MbXSa0fQ1O
mike zaman
1 Aug 15 03:59:54
Upcoming Profit and Loss Reports in Focus $SMG, $WLK, $PAA, $PAGP, $HCA, $VOYA, $SLF, $CTL, $MFC, $CORE http://t.co/5d4mNi2Ddg
InvestWithConf
1 Aug 15 03:25:02
$PAGP is rated BUY, 23.5% upside by Wall Street analysts based on average ratings/targets http://t.co/B6gtJhaMVV http://t.co/kCAyzowJOI
Capital Market Labs
31 Jul 15 17:53:22
Website -> http://t.co/ZNI1RpM55W $PAGP Reports Tuesday, Consensus Est. Rev: $5901.96M, EPS: $0.17 http://t.co/N5DE3tqz7Y
Jaclyn Fanger
31 Jul 15 16:34:51
RT @InvestingLatest: barronsonline: RT ameystone: JPMorgan: 4 Quality Oversold MLPs: $PAA, $PAGP, $ETP, $SUN http://t.co/OhElm5MNRK via bar…
MarketBeatCom
31 Jul 15 15:51:54
Get the latest ratings for $VEEV $PAGP $AERI $ZOES $SRLP in your inbox with MarketBeat Daily http://t.co/nSJuDsYidj
Britney Salvato
31 Jul 15 04:25:53
J.P. Morgan's top oversold high-quality MLPs: PAA, PAGP, ETP, SUN http://t.co/YM5vIC8vCH $PAA $PAGP $ETP $SUN
Marcia Gerald
31 Jul 15 03:25:50
RT @ameystone: JPMorgan: 4 Quality Oversold MLPs: $PAA, $PAGP, $ETP, $SUN http://t.co/L26TziOV1A via @barronsonline
Maria Finch
30 Jul 15 16:58:54
RT @InvestingLatest: barronsonline: RT ameystone: JPMorgan: 4 Quality Oversold MLPs: $PAA, $PAGP, $ETP, $SUN http://t.co/OhElm5MNRK via bar…
Leta Fulton
30 Jul 15 14:35:00
RT @ameystone: JPMorgan: 4 Quality Oversold MLPs: $PAA, $PAGP, $ETP, $SUN http://t.co/L26TziOV1A via @barronsonline
Greg David
29 Jul 15 10:07:48
Check out http://t.co/Y1RoKIXsmm. Top rated OTC trading group. Related: $JMEI $LUK $DDD $RXDX $RGLS $PAGP
TimeForGrowth
28 Jul 15 23:26:02
$PAGP: Wall Street analysts bullish on PAGP's earnings growth: http://t.co/mgxZEp1UeO http://t.co/R9jhtWj9H6
DailyStockPicks
28 Jul 15 09:38:18
$OCLS cheap health care stock. Price target of $5. 200%+ upside $ARE $PSEC $PAGP $KRA $RFP $CALL investors read http://t.co/rWpJvFmAFr
Penny Stock Secret
28 Jul 15 07:40:33
$71,000 in ONE TRADE!! By Follwing Their Signals More Info Here http://t.co/SVqoMkrw2z .. $PAG $PAGP $PAH
ProVesting
27 Jul 15 21:57:04
$PAGP: Plains Group Holdings, L.P. (NYSE:PAGP) Short Interest Update: http://t.co/bsKUbe5wSd
ProVesting
27 Jul 15 09:33:03
$PAGP: Notable Session Mover: Plains Group Holdings, LP (NYSE:PAGP): http://t.co/UbdywG6fto
Breaking News
27 Jul 15 08:09:15
$DEPO $PAGP: Plains GP Holdings (NYSE:PAGP), First American Financial: http://t.co/DZjAxbplJR
wsnewspublishers
27 Jul 15 07:45:00
Current Trade News Analysis on: http://t.co/nLFtivVAxV $PAGP $FAF $KSS $AREX
ProVesting
27 Jul 15 02:34:02
$PAGP $PLCM: Shares of Plains Group Holdings, L.P. (NYSE:PAGP) Sees Large ...: http://t.co/XbPv2i6fwT
ProVesting
27 Jul 15 02:28:04
$PAGP: Shares of Plains Group Holdings, LP (NYSE:PAGP) Sees Large ...: http://t.co/zujaOtCIM8
InvestWithConf
26 Jul 15 13:03:02
$PAGP is rated BUY, 32.5% upside by Wall Street analysts based on average ratings/targets http://t.co/B6gtJhaMVV http://t.co/CNaLy23kJA
Greg David
26 Jul 15 06:24:46
Check out http://t.co/Y1RoKIXsmm. Top rated OTC trading group. Related: $JMEI $LUK $DDD $RXDX $RGLS $PAGP
TimeForGrowth
25 Jul 15 08:18:02
$PAGP: Wall Street analysts bullish on PAGP's earnings growth: http://t.co/mgxZEp1UeO http://t.co/KLQjxSK4vq
dailystockplays.com
25 Jul 15 01:00:33
Bearish Cross http://t.co/umFkWOGy1O $ORCL $ITW $PAGP $BKD $RES $PCY $IMMU $DOC $ARW $VTL $PXH $BDCL $CVTI $CIU $ITR $CDTI $SDR $WGP
The Legacy News
24 Jul 15 08:28:16
Plains GP Holdings LP to Issue Quarterly Dividend of $0.23 on August 14th $PAGP http://t.co/i3AEVNRNWn
STRAT Trading
24 Jul 15 07:38:16
J.P. Morgan's top oversold high-quality MLPs: PAA, PAGP, ETP, SUN http://t.co/QFKBHxZzhM $PAA $PAGP $ETP $SUN
				
				
By  +Follow October 14, 2013 6:43PM
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