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Linn Energy, LLC (LINE) Message Board

  • ronharv ronharv Oct 21, 2012 2:15 PM Flag

    Linn's 13% Ownership of Linn Co

    Anyone know if Linn's 13% ownership is on top of the IPO and maybe the underwriter allocated units (which the banks had to have bought and likely are selling) or are Linn's units included in the initial 30 million units of the IPO?

    But more interesting I think is how the distributions work re taxes. Does Linn's left hand have to pay its LNCO right hand the distribution, pay taxes on it, and then keep less money than it started with? There's some weird circularity going on that I just don't understand.

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    • Number of LINE units prior to LNCO IPO: 200 million
      Number of LINE units post LNCO: 230 million
      30 million/230 million = 13%

      LNCO is a stand-alone entity. It will receive distributions from LINE, pay taxes itself, a pay the remaining funds to the sharehilders as dividends. Estimates are around 2% so dividends are estimated at .71 vs. LINE .725.

      See the " LinnCo Overview" on the Linn Energy website.

 
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