A master limited partnership (MLP), also known as a publicly traded partnership, is a limited partnership or limited liability company that is publicly traded on a US stock exchange and that earns over 90 percent of its income from certain qualifying sources. The vast majority of MLPs are involved in energy-related businesses.
Hunton Andrews Kurth was involved in the creation of the first MLPs in the early 1980s and served as issuer’s counsel on the first “drop down” MLP in 1983. Since the 1980s, we have been a market leader in MLP transactions because of our deep experience in the complex partnership, securities, tax and business issues associated with creating, governing and growing MLPs.
To date, we have:
- Participated in transactions involving 70 percent of the Alerian MLP Index, a composite of the 50 most prominent energy MLPs.
- Participated in transactions involving more than 50 percent of the natural resource-related MLPs and their general partners currently trading on US stock exchanges.
Since 2000, we have:
- Participated as issuer or underwriter counsel on 50 IPOs of MLPs or their general partners.
- Participated as issuer, underwriter or investor counsel in more than 240 follow-on equity offerings of MLPs or their general partners, including private placements, registered offerings and at-the-market offerings (ATMs).
- Participated as acquirer, target, special committee or special committee financial advisor counsel in more than 60 percent of the MLP to MLP mergers.
- Participated as issuer or underwriter counsel in more than 135 debt offerings of MLPs, their subsidiaries or their general partners, including private placements and registered offerings
We have been instrumental in the design of the variable distribution MLP, which has been used in nine recently completed MLP IPOs.
We Represent Clients in All Relevant Industries
Our clients include:
- MLPs, their general partners, their subsidiaries, their sponsors and their conflicts and special committees.
- Underwriters, investment banks, placement/sales agents and financial advisors.
- Private equity funds and other institutional investors that acquire MLP securities from MLP issuers and selling unitholders or that purchase assets from, or enter into joint ventures with, MLPs.
Due to our decades of involvement with MLPs, our lawyers have experience with MLPs in the midstream, downstream, upstream, LNG, coal, shipping, propane, heating and fuel oil, timber, petroleum coke, propylene, real estate and nitrogen fertilizer industries.
We Have Vast Experience
Our MLP practice includes lawyers with substantial tax, capital markets, finance and mergers and acquisition experience. These lawyers work with their colleagues in our employee benefits, environmental and regulatory practices to provide clients sound and efficient advice on all MLP-related matters.
Lawyers in our MLP practice have substantial experience in all matters relevant to MLPs, including:
- All stages and forms of pre-MLP investments, including private equity investments in MLP-qualifying income-generating assets;
- Representation of private equity investors and management teams in the creation of “private” MLPs;
- Pre-IPO planning and structuring, including accounting pre-clearance letters;
- MLP formation issues;
- Representation of MLPs and their general partners, underwriters and institutional investors in public and private equity offerings, including IPOs, follow-on offerings, selling unitholder offerings, ATMs, bought deals and PIPEs;
- Representation of MLPs, their subsidiaries and their general partners and underwriters in public and private debt offerings, including investment grade and high-yield offerings;
- Representation of MLPs, their sponsors and their conflicts and special committees in mergers, acquisitions, asset dispositions, general partner disposition transactions, sponsor “drop down” transactions, joint ventures, recapitalizations, restructurings, business combinations and incentive distribution restructurings;
- Representation of boards, conflicts and special committees, financial advisors and investment banks regarding MLP governance, fiduciary duty and conflict of interest issues;
- Representation of underwriters in equity offerings, including IPOs, of closed-end investment companies that invest in MLP securities;
- MLP partnership agreement issues, including interpretation, compliance, amendments and, when necessary, unitholder approval;
- Representation of MLP borrowers and lenders in the negotiation of bank credit facilities;
- Securities and Exchange Commission (SEC) reporting issues unique to MLPs, including proxy statement, periodic reporting and Section 16 reporting issues;
- National securities exchange rules applicable to MLPs;
- FINRA rules applicable to securities offerings of MLPs and their general partners;
- Tax structuring for MLPs and their sponsors (including pre-IPO private equity investments in MLP compatible assets) and ongoing tax planning for significant MLP transactions and securities offerings, including “qualifying income” tax opinions and analysis, “tax shield” planning, MLP to MLP mergers, constructive termination planning, disguised sale analysis and depreciation recapture;
- Representation of MLPs in seeking Internal Revenue Service (IRS) private letter rulings regarding the qualification of MLP income under the IRS’ qualifying income rules;
- Accounting issues unique to MLPs;
- Federal Energy Regulatory Commission (FERC) matters unique to MLPs and their income tax allowance as well as proceedings before the FERC regarding regulated and negotiated rates; and
- Employee benefit plan structuring and compensation and related SEC disclosure issues.