Energy Transfer Partners LP (NYSE: ETP) and Regency Energy Partners LP (NYSE: RGP) have completed their merger of an indirect subsidiary of ETP, with and into Regency, with Regency surviving the merger as a wholly owned subsidiary of ETP.
Effective with the opening of the market on April 30, Regency ceased to be a publicly traded partnership, and its common units discontinued trading on the NYSE.
As part of the merger consideration, each Regency common unit and Class F unit will be converted into the right to receive 0.4124 ETP common units. Based on the RGP units outstanding, ETP issued approximately 172.154 million ETP common units to RGP unitholders, including approximately 15.526 million units issued to ETP subsidiaries. The approximately 1.913 million outstanding Regency Series A preferred units were converted into corresponding new ETP Series A preferred units.
In connection with the transaction, Energy Transfer Equity LP (NYSE: ETE), which owns the general partner and 100% of the incentive distribution rights (IDRs) of ETP, will reduce the incentive distributions it receives from ETP by a total of $320 million over a five-year period. The IDR subsidy will be $80 million in the first year post-closing and $60 million per year for the following four years.