VTTI Energy Partners (VTTI) Will Take Additional VTTI MLP B.V. Stake
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VTTI Energy Partners LP (NYSE: VTTI) announced that its wholly owned subsidiary, VTTI MLP Holdings Ltd., has entered into a purchase and sale agreement to acquire an additional 8.4% equity interest in VTTI MLP B.V. ("VTTI Operating") and associated pro-rata net debt from VTTI MLP Partners B.V. for cash consideration of $96.2 million (the "Acquisition"). The Partnership expects the Acquisition to close and be effective September 1, 2016, subject to customary closing conditions. Following the closing of the Acquisition, the Partnership would indirectly own a total economic interest of 51.0% and a 51.0% indirect voting interest in VTTI Operating.
The terms of the acquisition were approved by the board of directors of the general partner of the Partnership, based on the approval and recommendation of its conflicts committee. The conflicts committee was comprised entirely of independent directors and retained a financial advisor to assist with its evaluation of the Acquisition.
The acquisition of the additional economic interests in VTTI Operating is expected to be accretive to the Partnership's distributable cash flow and to implement the Partnership's strategy to deliver distribution growth to its unitholders. The Partnership's announcement on July 25, 2016 of a quarterly distribution of $0.3204 per unit (corresponding to an annualized distribution of $1.2816 per unit) for the second quarter of 2016 represented an increase of 3.1% as compared to the Partnership's quarterly distribution of $0.31085 for the first quarter of 2016. Any future increases in the Partnership's distributions would be conditioned upon, among other things, the closing of the Acquisition, the approval of such increases by the board of directors and the absence of any material adverse developments or potential alternative strategic opportunities that would make such future increases inadvisable.
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