Tuesday, September 18, 2018

For The Archives -- ENB, EEP, EEQ -- September 18, 2018

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For the archives: ENB, EEP, EEQ, from MarketWatch --
  • EEP unitholders will receive 0.3350 common shares of ENB for each common unit of EEP; an 8.7% increase to the exchange ratio proposed earlier of 0.3083 ENB common shares
  • EEQ: 0.3350 ENB; at parity with the EEP exchange ratio
Significant weakening of the U.S. Master Limited Partnership (MLP) capital markets has adversely affected the growth opportunities for MLPs, including EEP. MLPs are dependent on consistent access to capital markets at an effective cost of capital to fund projects to grow their distributions.
The respective March 15 and July 18, 2018 income tax allowance policy announcement and order by the Federal Energy Regulatory Commission (FERC), and the regulatory rate impact from the U.S. Tax Cuts and Jobs Act have had a net significant adverse impact on EEP.
If EEP were to continue as a stand-alone entity, after taking into account its lower revenue and weak MLP capital markets, it would be required to transition to a self-funding model with no cost effective access to equity capital. EEP's priority would be to strengthen its balance sheet, which would require near term incremental Enbridge support, and reduce its distributions, which would have corresponding negative implications to EEQ. 
(Approximate?) closing prices, September 17, 2018:
  • ENB: $34.28
  • EEP: $11.25
  • EEQ: $10.80
Distribution history: https://www.nasdaq.com/symbol/eep/dividend-history.a

Notes to the Granddaughters

For Father's Day -- some months ago -- the Tutor Time teacher recorded Sophia's answers to the following questions:

Questions and answers:
  • Where does your dad work: at the airport
  • Favorite thing to do with your dad: go to my party
  • My dad's super power: sleeping good
  • I love dad more than: cupcakes
  • My dad laughs when he: tickles me
  • I love my dad because:  he loves me so much

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