Energy firms grab tie-ups in $20 billion deal trifecta

Bloomberg

Two of North America’s biggest pipeline companies and the top US natural gas exporter are all absorbing subsidiaries in moves aimed at curbing future tax obligations following a federal overhaul.
Williams Cos. said it will buy the remaining stake in Williams Partners in a $10.5 billion all-stock deal. Cheniere Energy Inc. is buying up the partnership that holds units in its Sabine Pass LNG terminal. And Calgary-based Enbridge Inc. said it made all-share offers to the boards of its units to acquire all outstanding securities.
Pipeline stocks plunged in March after regulators said so-called master limited partnerships can no longer charge customers for taxes the companies don’t pay, limiting their appeal as an investment vehicle.
The announcements follow a similar move by Kinder Morgan Inc. in 2014, with Energy Transfer Partners LP potentially next in line.
Analysts were generally positive on the moves. “We’ve been expecting all of these to happen at some point,” said Michael Kay, an analyst at Bloomberg Intelligence. They “are an effort to clean up their corporate structures.” It’s not the end of MLPs, he said, but it means there will be “a smaller field of players.”