(RTTNews) - Atlas Pipeline Partners, L.P. (APL), a provider of natural gas gathering services, said Wednesday it has entered into a definitive agreement to sell its Elk City facilities to Enbridge Energy Partners, L.P. (EEP) for $682 million in cash, subject to working capital adjustments. Following the news, shares of the company jumped over 29% in morning trade.

Atlas Pipline said that the liquidity resulting from the transaction will allow it to reinstate distributions to unitholders, while the financial flexibility will allow Atlas Pipeline to participate in the sharp growth of its Marcellus Shale gathering venture.

The transaction is expected to close in the third or fourth quarter, subject to traditional closing conditions and adjustments.

Atlas Pipline also noted that the transaction will eliminate virtually all senior secured debt and significantly deleverages its balance sheet.

Upon completion of the transaction, Atlas Pipeline will pay-off its $422 million secured term loan and repay approximately $250 million of its revolving credit facility, leaving an anticipated $340 million of liquidity under this line and an outstanding balance of approximately $40 million.

Chief Executive Officer of Atlas Pipeline Partners, Eugene Dubay said that the transaction would improve the company’s balance sheet and provides significant upside for growth. He added that the deal would grow its strategic asset base and provides a balanced approach to debt reduction.

APL is currently trading at $16.00, up $3.65 or 29.55%, on a volume of 6.13 million shares on the NYSE.

For comments and feedback: contact editorial@rttnews.com

Copyright(c) 2010 RTTNews.com, Inc. All Rights Reserved

Posted in Categories: Economy, Releases, USA.

Subscribe by RSS Subscribe by Email