By Aparajita Saxena
(Reuters) - British energy company BP
BP Midstream Partners LP, the master limited partnership (MLP) formed by BP's U.S. pipeline unit, plans to list on the New York Stock Exchange under the symbol "BPMP," it said in a filing with the U.S. Securities and Exchange Commission.
The offering comes nearly two months after BP outlined plans to spin off some of its U.S. pipeline assets in an IPO to raise cash.
The IPO revives a plan first broached internally about five years ago before slumping crude oil prices caused BP to put the idea on hold, a source told Reuters in July.
Other energy companies that have spun off their pipeline assets include Royal Dutch Shell
An MLP is a tax-advantaged structure often used by pipelines and other capital intensive companies to distribute excess cash to investors in the form of tax-deferred dividends. Most MLPs rely on external debt to fund new projects.
Rising interest rates have made borrowing costlier for MLPs, weighing on their performance in recent months despite stabilizing oil prices.
The Alerian MLP ETF
"BP's rationale for an MLP structure is basically to attract more investors," Raymond James analyst Muhammed Ghulam said.
BP's U.S. pipeline business includes a network of 3,500 miles (5,633 kilometres) of pipelines and terminal facilities that transport and store more than 1.3 million barrels per day of oil, refined products and natural gas. In addition to the Gulf Coast and Midwest assets, BP operates pipelines in the Pacific Northwest.
Citigroup, Goldman Sachs, Morgan Stanley, Barclays, Credit Suisse and JPMorgan are among the underwriters for BP Midstream Partners' IPO.
BP Midstream said it intends to raise up to $100 million in the IPO.
The amount of money a company says it plans to raise in its first IPO filings is used to calculate registration fees. The final size of the IPO could be different.
(Reporting By Aparajita Saxena in Bengaluru; Editing by Sai Sachin Ravikumar)