Shares of master limited partnership TransMontaigne Partners (NYSE: TLP) were up 12.7% as of 11:45 a.m. EST today after the company announced that a private equity firm would acquire it.
Continue Reading Below
As it happens every time there is a buyout, shares are up to the proposed acquisition price -- $41 per share in this case. The storage and logistics specialist announced that ArcLight Energy Partners Fund, a subsidiary of private equity firm ArcLight Capital Partners, will acquire the outstanding stake it doesn’t already own.
It was likely just a matter of time until this merger happened, as ArcLight and its various affiliate funds owned the general-partner stake in TransMontaigne and had made an offer in July to acquire it. This new offer is a 7.9% premium to its prior offer.
TransMontaigne had a lot of qualities an investor would want in an oil and gas storage and logistics company. Management was conservative with its payout, kept a modest debt profile, and kept payouts more or less growing since its IPO close to a decade ago. That was likely a large reason ArcLight was interested in the business in the first place. With the buyout price baked into the stock, though, there is no reason for investors to buy now.
How to simplify investing -- in just 30 minutes a dayIt's roughly the same amount of time it takes to walk a quarter-mile on a treadmill... whip up dinner... read your children a bedtime story. And it's how little time it takes to learn everything you need to know to begin investing in the stock market. (Which -- if you're like most of us -- is something you know you should do... but keep putting off.) The Motley Fool's Director of Investor Learning is eager to help you start down that venture -- absolutely FREE -- in just 30 minutes a day, for 13 days.