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Enterprise Products Partners L.P. Message Board

  • treenstandno2 treenstandno2 Oct 24, 2009 9:14 AM Flag

    Done is Done..

    As a holder of TPP the merger was not my choice but done is done.

    Based on revenues per share with TPP having $96.33 and EDP $37.60 the merger will make EDP much stronger.

    With the new stock and TPP’s revenues the new EDP will have $45.58 in revenues per share or roughly 25% higher.

    I put value of the new EDP at around $37. To $40.

    With oil at $70+ and oil and gas coming back into favor and winter depleting gas storage reserves EDP could easily go much higher say $50 to $60 in near term.

    Revenues: TPP $9.91b, EDP $16.81b
    Rev per share: TPP $96.33, EDP $37.60
    Common shares: TPP 104.6m, EDP 457.3m

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    • And the even better news is that EPD stated that with the efficiencies associated with this merger they expect to be able to continue to increase the distribution the way they have for the foreseeable future. Since TPP was NOT increasing their distribution, TPP holders will break even next year and be ahead of the game thereafter.


    • am I rite that the TPP owners get the EPD dist. of.55.25 instead of TPP nov dist of.72.5 if deals closes by Oct 30

      • 1 Reply to nsupper1
      • The last distribution declaration from TPP was July-20 to be paid Aug-7 for $.725.

        From EPD $.5525 to record of Oct-30 , paid Nov-5th.

        I believe you are right that we might be getting $.515 as declared by EPD.

        The good part is that by getting 1.24% shares we will be getting the equivalent of $.639.

        Then again? We were not holders of EPD on OCT-30.

        That is interesting for sure...

        Next quarter will tell how this merger will affect our distributions.

    • Another way I measure the value of EPD is by price / sales ratio.

      TPP had a PSR of .39

      Mk = 3.89B / s = 9.91b = .39.

      EPD had a PSR of .81

      Mk = 13.66 / s =16.81 = .81

      By applying the PSR of .81 to the new revenues and number of shares to EPD the price comes out to around $40.

      .81 x 26.72b = 21.64b / 586.9 shares = $36.87

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