quite a remarkable transformation of NRGY in the last year from a propane distributor to the GP controlling a diverse set of midstream assets (after the NRGM CMLP merger). Pretty impressive how they completely transformed the company bin such a short time.
As a CMLP, soon to be NRGM unitholder, the only think I really dislike about the structure (although it is good for NRGY) is the unusually onerous IDR structure. When NRGM was first IPOd, it came out with a structure that send it to the top 50% IDR tier at any distribution level higher than the initial minimum distribution (which it passed with the first full quarter's distribution). I'm not against IDRs in general like a lot of MLP investors are, however this is the exception with that unique (so far as I know) extreme structure. All the others at least have to raise the distributions considerably at the LP (and thus benefit unitholders in the process) before the top tier kicks in and 50% of cash flow goes to the GP. It's clear why NRGY rallied after the merger announcement as the addition of the CMLP assets will boost cash flow to the GP NRGY.
Liza, I see you on many energy related boards. CMLP was on my watch list, but don't own it. I am not sure what to buy out of this deal.......NRGM, or NRGY. I like the deal, and the assets areas they hold and believe it's a win-win going forward.