Tuesday, May 17, 2016 -- Mr Big Stuff -- Who Do You Think You Are?

Mr Big Stuff. Pipelines. PennEnergy is reporting that TransCanada will acquire Columbia Pipeline Group in a deal valued $13 billion, including debt ($25.50/share in cash). At $25.50, this represents a premium of 32%. CPG:

• HQ: Houston, TX
• 15,000+ miles of interstate pipeline, gathering and storage assets
• from New York state to Gulf of Mexico
• integrated with one of the largest underground natural gas storage systems in North America
• major pipeline network in northeast US
• perhaps two jewels:
• first: a 12,000-mile pipeline system transiting 10 states: the Columbia Gas Transmission line
• this jewel also operates that large NG storage system: 37 storage fields in four states; 650 billioin+ cubic feet in total capacity
• second: a 3,400 mile interstate pipeline, primarily in four states: LA, MS, TN, KY: the Columbia Gulf Transmission

Mr Big Stuff, Jean Knight

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Mexico's gasoline consumption increasing; imports increasing. Reuters reports.

Common theme from multiple sources today: China "moving."

• China is about to go on a huge US shopping spree
• China just overtook Canada as the largest foreign buy of US residential real estate

US industrial production jumps by most since November, 2014. The AP is reporting. Data points:

• industrial output rose 0.7%, after dropping previous two months
• industrial production improved because utility output surged following an unusually mild March
• utility output: biggest jump since February 2007 (simply a function of a "down" month in March
• factory output rebounded 0.3%, the most since January; auto and machinery production led the way
• falling dollar helped (improved exports)
• mining (includes oil and coal): dropped 2.3%; the pain is not over 

Japanese March industrial output up 3.6% -- Reuters.

• again: due to a fluke, one-time factors
• huge drop in February due to Lunar New Year holidays in Asia 
• Toyota Motor Corp's temporary halting of factory output due to an explosion at a steel plant