AHGP - MLP Structural Simplifications: Part 1 - Reorganizations
By Stacey Morris
Several transactions in the MLP space have been proposed or completed in the name of simplification. Simplification is generally a good thing as it typically means more transparency and lower costs. In the MLP space, we tend to hear about structural simplifications through reorganizations and elimination of incentive distribution rights (IDRs) . This week, we'll look at reorganizations, and next week, we'll look at IDR eliminations.
Simplification can be achieved through reorganizations that typically involve consolidating two related entities into one public entity. A lower cost of capital, increased transparency, improved efficiency,