CorpRaider Posted July 31, 2014 Share Posted July 31, 2014 KMP goes north to New England and Canada and El Paso goes south... http://finance.yahoo.com/news/kinder-morgan-details-expansion-plans-150000579.html Link to comment Share on other sites More sharing options...
Andy Dufresne Posted August 10, 2014 Share Posted August 10, 2014 Kinder Morgan, Inc. to Purchase KMP, KMR and EPB; 2015 KMI Dividend to Increase to $2 per Share http://phx.corporate-ir.net/phoenix.zhtml?c=93621&p=irol-newsArticle&ID=1957206&highlight= Link to comment Share on other sites More sharing options...
Myth465 Posted August 10, 2014 Share Posted August 10, 2014 That was quick. I sold leaps and was looking to buy back in. Will be interesting to see how it runs. Might be a good time to look at the warrants again. Link to comment Share on other sites More sharing options...
CorpRaider Posted August 10, 2014 Share Posted August 10, 2014 They went the opposite of the direction that I anticipated. I guess cashiering the MLPs is one way to go. Link to comment Share on other sites More sharing options...
Otsog Posted August 10, 2014 Share Posted August 10, 2014 There is no way Richard Kinder issues that much KMI if it isn't overvalued, right? Link to comment Share on other sites More sharing options...
Myth465 Posted August 11, 2014 Share Posted August 11, 2014 I think they have gotten the most they could out of the MLP structure. Its now causing a discount across the brand, has layers of accts / managers, and complicates things. Also getting an investment grade rating will make it easier to take on new projects. My guess is whatever they give up by closing down the MLPs, they make up in stock rerating, cheaper debt, and synergies from pulling out the various management layers / sign offs. Link to comment Share on other sites More sharing options...
gokou3 Posted August 11, 2014 Share Posted August 11, 2014 I was hoping it is KMI that gets bought out too, but I think this isn't a bad outcome for KMI shareholders either. The re-rating would still occur, it may just take a little more time. http://www.kindermorgan.com/investor/presentations/KMI_Purch_MLPs_Investor_Presentation.pdf Page 10 of the above presentation is the most interesting for KMI shareholders. Management assumes that KMI will trade *conservatively* at 4.5% yield. At a $2 annual dividend, this suddenly becomes a $44.4 stock --> round it down to $40 since the higher dividend begins in 2015. Page 7 shows peer valuation. It's not a stretch to expect KMI will trade at 4% yield post merger, i.e. $50. Really happy with my 2016 $30 leaps. Link to comment Share on other sites More sharing options...
CorpRaider Posted August 11, 2014 Share Posted August 11, 2014 Looks to be trading up toward $44 in pre-market. Looking forward to conference call at 8:30. Link to comment Share on other sites More sharing options...
Liberty Posted August 11, 2014 Share Posted August 11, 2014 http://glennchan.wordpress.com/2014/08/11/my-thoughts-on-the-kmi-merger/ Link to comment Share on other sites More sharing options...
saltybit Posted August 11, 2014 Share Posted August 11, 2014 Warrants are up big premarket. (2.88 -> 4.77) Link to comment Share on other sites More sharing options...
CorpRaider Posted August 11, 2014 Share Posted August 11, 2014 Yeah, just applying the current yield to the projected dividend, it seems like they ought to be worth in the zip code of $10 or so bucks by exercise if the projections in the deal pitch come to pass. Of course, that assumes no accretive deals. Link to comment Share on other sites More sharing options...
gfp Posted August 11, 2014 Share Posted August 11, 2014 KMP holders seem to be getting the worst deal here, with potentially huge tax consequences depending on how long they have been deferring (how long they've been unitholders). KMR holders did fairly well and KMR is now the more attractive security at 91.44 (vs KMI). If KMR hits 89.46 today it will be superior to buying KMI on Friday before the deal was announced. At this spread between KMR and KMI, there is no reason to purchase KMI unless through warrants. Even though we (as large KMR holders) have taken a dividend cut on the deal, I like the deal quite a bit. I would be upset if I were a KMP holder in a high tax bracket - which most probably are. The tax bill will shock them if they've been long time holders. Link to comment Share on other sites More sharing options...
fareastwarriors Posted August 14, 2014 Share Posted August 14, 2014 Unraveling the Tax Bill of the Kinder Morgan DealKinder Morgan Notches Tax Savings from Deals Kinder Morgan's big reorganization should save about $20 billion in income taxes over the next 14 years. But a tax bill could be coming for some longtime holders. http://online.wsj.com/articles/unraveling-the-tax-bill-of-the-kinder-morgan-deal-1407970549#livefyre-comment Link to comment Share on other sites More sharing options...
peter1234 Posted August 16, 2014 Share Posted August 16, 2014 Kinder Morgan CEO Wins In Deal Richard Kinder, the CEO of Kinder Morgan, stands to collect $467 million in dividend payments next year, if his company completes a complex deal to consolidate four related pipeline companies. http://online.wsj.com/articles/kinder-morgan-ceo-wins-big-in-deal-1408145793 Link to comment Share on other sites More sharing options...
CorpRaider Posted August 29, 2014 Share Posted August 29, 2014 NYT article linked below on anticipated consolidation in the industry discusses several potential targets for KMI: http://nyti.ms/1mXkqmA I would think WMB is available if they thought they could get it by DOJ, given that Keith Meister at Corvex (along with Soroban, former TPG-Axon guy) are running the show over there now. I'm sure they would rather have Rich Kinder running those assets for them. Link to comment Share on other sites More sharing options...
Picasso Posted October 14, 2014 Share Posted October 14, 2014 Well below the price at the time of merger. Anyone still involved with this stock? I have trouble finding the right way to value it. Link to comment Share on other sites More sharing options...
frommi Posted October 14, 2014 Share Posted October 14, 2014 Yes i valued it by dividend yield+growth, but i am not really happy with that way to value it. KMP and KMI trade on a EV/EBITDA multiple of 11.5, but will the combined entity too? (That would be a bit high for me). For now i stick with the stock and look if Mr. Kinder is able to keep his promises. For a 2015 dividend yield of 5.8% with 10% growth the stock is too cheap here. And when i understood everything right, the business is not really dependent on commodity prices. Link to comment Share on other sites More sharing options...
DCG Posted October 14, 2014 Share Posted October 14, 2014 I still own it. Link to comment Share on other sites More sharing options...
Picasso Posted October 14, 2014 Share Posted October 14, 2014 How are you valuing it? I know Rich Kinder himself is trying to value it based on the dividend but I am not sure exactly how you can do that. It would be like saying P&G pays 3% so if it has the same dividend yield as Colgate it would be 30% higher in price. There is also higher leverage present within KMI that should make the valuation a bit cheaper to peers, no? I did a dividend discount model (which I HATE doing, but that is another topic) and I come up with a $38 price at 15% growth for the next 7 years with a 75% payout rate. At 100% payout rate I get a $50 price. Doesn't seem that cheap unless Rich Kinder does a few good deals? Link to comment Share on other sites More sharing options...
gokou3 Posted October 14, 2014 Share Posted October 14, 2014 How are you valuing it? I know Rich Kinder himself is trying to value it based on the dividend but I am not sure exactly how you can do that. It would be like saying P&G pays 3% so if it has the same dividend yield as Colgate it would be 30% higher in price. There is also higher leverage present within KMI that should make the valuation a bit cheaper to peers, no? I did a dividend discount model (which I HATE doing, but that is another topic) and I come up with a $38 price at 15% growth for the next 7 years with a 75% payout rate. At 100% payout rate I get a $50 price. Doesn't seem that cheap unless Rich Kinder does a few good deals? I think the valuation model is flawed if the IV changes with the payout rate. Growth and payout rate go hand in hand. For me, I look at the relative valuation with its peers (EPD, williams, etc) and see that KMI has a higher yield for a similar dividend growth profile. Link to comment Share on other sites More sharing options...
gfp Posted January 21, 2015 Share Posted January 21, 2015 KMI slipping in an acquisition announcement right before earnings release and conference call this afternoon - Buying midstream assets from Harold Hamm - http://phx.corporate-ir.net/phoenix.zhtml?c=93621&p=irol-newsArticle&ID=2009339 edit: and here is the dividend increase and earnings announcement - http://phx.corporate-ir.net/phoenix.zhtml?c=93621&p=irol-newsArticle&ID=2009368 (looks like they switched to BRK subsidiary BusinessWire in the last 24 hours) *** Kinder stepping down as CEO, to become executive Chairman Link to comment Share on other sites More sharing options...
gfp Posted June 12, 2015 Share Posted June 12, 2015 We get the message already, Mr. Kinder... He is one of the only people I know of who files his Form 4 with the SEC within a few minutes of making a purchase.. http://www.sec.gov/Archives/edgar/data/1031190/000158474615000012/xslF345X03/primary_doc.xml then a few minutes later, this- http://www.sec.gov/Archives/edgar/data/1506307/000150630715000032/kmi8-k06x11x2015.htm Link to comment Share on other sites More sharing options...
CorpRaider Posted June 22, 2015 Share Posted June 22, 2015 Energy Transfer Equity made an unsolicited bid for Williams ~33% premium (credit to Bloomberg for naming bidder). Williams rejected and is "evaluating options." Was just looking at WMB as a comp for KMI last week. Kinder and ETP mentioned as potential suitors. At least the nice thing when CEO has real money in game is that he won't (consciously) overpay just because "everyone else has one." Interesting that ETE wanted to scrap consolidation plan, WMB said in rejection that the consolidation would offer larger pay off than proposed ETE offer. KMI clearly sees the benefits of such a consolidation. WMB + KMI = ESSO part deux? http://www.wsj.com/articles/williams-cos-rejects-48-billion-buyout-offer-1434930560?mod=yahoo_hs Link to comment Share on other sites More sharing options...
CorpRaider Posted August 5, 2015 Share Posted August 5, 2015 What news am I missing in the MLP space today? ETE, WMB and KMI are all getting smoked. I'm about to pick up some WMB (you don't have to be a genius to know its in play and had an (all stock) bid of ~$64 within the last month), but spidey sense indicates there's a bus coming down the street. Link to comment Share on other sites More sharing options...
gokou3 Posted August 5, 2015 Share Posted August 5, 2015 What news am I missing in the MLP space today? ETE, WMB and KMI are all getting smoked. I'm about to pick up some WMB (you don't have to be a genius to know its in play and had an (all stock) bid of ~$64 within the last month), but spidey sense indicates there's a bus coming down the street. It seems to me that the recent ridiculous weakness in KMI is due to (still) lower oil prices and the stronger expectation that it will stay low for the forseeable future. My understanding is KMI is largely immuned from oil price fluctuations except for its CO2 business which it has hedged out its production for this year. I guess the market is concerned when the hedges expire, their earnings / cashflow will take a hit. May be they worry that the low oil price will squeeze out incremental NG demand too? I don't know, KMI is mostly just a toll bridge operator. Long KMI, planning to add but yes I get the spidey sense that it has further to fall. Link to comment Share on other sites More sharing options...
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