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Inergy distributes Inergy Midstream units

KANSAS CITY, Mo. (AP) -- Inergy LP, which sells propane and operates a natural gas storage business, said Wednesday that it completed its distribution to its unit holders of the about 56.4 million common units that it previously held in Inergy Midstream LP.

The distribution marks the first step in Crestwood Midstream's takeover of Inergy LP.

As part of the distribution, each Inergy unit holder of record as of Friday received 0.432052 Inergy Midstream common units for each of their Inergy LP units, the partnership said.

Raymond James analyst Darren Horowitz called the move a "structural cleanup" ahead of Crestwood's takeover.

Last month, Crestwood Midstream Partners LP and Crestwood Holdings LLC announced plans to form a partnership with Inergy LP and Inergy Midstream LP to help meet increasing demand for shale field services in North America.

The arrangement is expected to require a series of deals that will result in Crestwood Holdings acquiring control of Inergy LP. The transactions are expected to close by the third quarter.

In midday trading, Inergy LP units rose 69 cents, or 4.9 percent, to $14.83, while Inergy Midstream units fell 24 cents to $22.64.