VTTI Energy Brings World’s Crude Oil Terminals to Investors

Post on: 3 Апрель, 2015 No Comment

VTTI Energy Brings World’s Crude Oil Terminals to Investors

NEW YORK (TheStreet ) — VTTI Energy Partners’s (VTTI ) initial public offering may open U.S. investors to a unique type of infrastructure master limited partnership (MLP). The company will package growth opportunities from foreign crude oil and petroleum markets into a yield-oriented MLP structure that has been vital to the growth of the onshore energy drilling and infrastructure in the U.S.

On Friday, VTTI Energy Partners listed its shares on the New York Stock Exchange. raising $368 million in a 17.5 million share offering that priced at $21, the high end of the company’s IPO range. Shares gained over 5% on Friday, closing at $22.10.

VTTI Energy Partners CEO Robert Nijst told TheStreet he views the company as a unique offering for MLP investors in the U.S. There is simply no other terminal company that has this type of network, Nijst said in a telephone interview, referring to the company’s portfolio of terminals in Amsterdam, the Netherlands, Belgium, the United Arab Emirates, Malaysia and the U.S.

Nijst said that VTTI Energy Partners is particularly interested in expanding its presence in Europe, Asia and some parts of Africa. By listing as an MLP in the U.S. Nijst said he expects VTTI Energy Partners to have a cost of capital advantage when compared against European competitors. The company may not expand as aggressively in the U.S. which represents less than 10% of the company’s total capacity.

In the U.S. the adoption of MLPs has helped independent terminal owners concentrate the ownershop of midstream assets. International markets, however, remain far more fragmented and operate with higher costs of capital. Even if VTTI Energy Partners doesn’t invest heavily in the U.S. CEO Nijst said the company is positioned to benefit from an increase in U.S. energy exports through rising activist at its European, African and Asian terminals.

The London-based company generated $299 million in 2013 revenue and a profit of $70 million in net income. By the end of fiscal 2015, VTTI Energy Partners forecasts it will have $311 million in revenue and adjusted earnings before interest, taxes, depreciation and amortization of $200 million.

Overall, VTTI Energy Partners expects to have $47.6 million in cash available for distribution by fiscal 2015, of which it will pay out $43.2 million in distributions, or $1.05 in distributions per unit.

CFO Rubel Yilmaz said in a telephone interview the company is guiding for a top quartile distribution relative to the wider MLP sector and that the company’s first dropdown is expected to occur in the next 12-months.


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