FINDLAY, Ohio, Feb. 27, 2014 - MPLX LP (MPLX) today announced that it has agreed to acquire an additional 13 percent interest in MPLX Pipe Line Holdings LP (Pipe Line Holdings) from a subsidiary of Marathon Petroleum Corporation (MPC) for $310 million. This transaction represents MPLX`s second acquisition following its initial public offering in October 2012. This acquisition will increase MPLX`s interest in Pipe Line Holdings to 69 percent from the 56 percent interest it held previously. Pipe Line Holdings owns a 100 percent interest in Marathon Pipe Line LLC (MPL) and Ohio River Pipe Line LLC (ORPL). MPL and ORPL own one of the largest networks of common carrier crude oil and product pipelines in the U.S. based on total volume delivered; a barge dock on the Mississippi River; and crude oil and product storage facilities.
"MPLX remains committed to achieving a distribution growth rate of 15 to 20 percent for the next several years," said Gary R. Heminger, chief executive officer. "The acquisition of this additional interest is a further step toward meeting this commitment and brings additional high-quality earnings into MPLX`s stream of distributable cash flows."
The acquisition price represents an approximate 10 times multiple of the assets` forecasted next twelve months earnings before interest, taxes, depreciation and amortization. The transaction is expected to close effective March 1, 2014, and be immediately accretive to distributable cash flow. MPLX intends to fund the acquisition through a combination of $40 million of cash on hand and a $270 million borrowing on its $500 million revolving credit facility.
The terms of the acquisition were approved by the board`s Conflicts Committee, which is comprised entirely of independent directors. This committee was advised by Evercore Partners as to financial matters and Akin Gump Strauss Hauer & Feld LLP as to legal matters.
About MPLX LP
MPLX is a fee-based, growth-oriented master limited partnership formed in 2012 by Marathon Petroleum Corporation to own, operate, develop and acquire pipelines and other midstream assets related to the transportation and storage of crude oil, refined products and other hydrocarbon-based products. Headquartered in Findlay, Ohio, MPLX`s assets consist of a majority equity interest in a network of common carrier crude oil and products pipeline assets located in the Midwest and Gulf Coast regions of the United States and a 100 percent interest in a butane storage cavern located in West Virginia. For additional information about the company, please see our website at http://www.mplx.com.
Investor Relations Contacts:
Beth Hunter (419) 421-2559
Geri Ewing (419) 421-2071
Angelia Graves (419) 421-2703
Brandon Daniels (419) 421-3127
This press release contains forward-looking statements within the meaning of the federal securities laws. These forward-looking statements relate to, among other things, MPLX`s expectations, estimates and projections concerning MPLX`s business and operations, distribution growth rates and the timing and benefits of the acquisition. You can identify forward-looking statements by words such as "anticipate," "believe," "estimate," "expect," "achieve," "forecast," "project," "could," "may," "should," "would," "will" or other similar expressions that convey the uncertainty of future events or outcomes. Such forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond MPLX`s control and are difficult to predict. Factors that could cause actual results to differ materially from those in the forward-looking statements include: the adequacy of our capital resources and liquidity, including, but not limited to, availability of sufficient cash flow to pay distributions and execute our business plan; the timing and extent of changes in commodity prices and demand for crude oil, refined products, feedstocks or other hydrocarbon-based products; volatility in and/or degradation of market and industry conditions; completion of pipeline capacity by our competitors; disruptions due to equipment interruption or failure, including electrical shortages and power grid failures; the suspension, reduction or termination of MPC`s obligations under our commercial agreements; our ability to successfully implement our growth strategy, whether through organic growth or acquisitions; state and federal environmental, economic, health and safety, energy and other policies and regulations; other risk factors inherent to our industry; and the factors set forth under the heading "Risk Factors" in MPLX`s Annual Report on Form 10-K for the year ended December 31, 2012, filed with the Securities and Exchange Commission (SEC). Copies of MPLX`s Form 10-K are available on the SEC website, MPLX`s website at http://ir.mplx.com or by contacting MPLX`s Investor Relations office.
This announcement is distributed by NASDAQ OMX Corporate Solutions on behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: MPLX LP via GlobeNewswire