HOUSTON – Shell’s midstream initial public offering took flight early Wednesday, gaining more than 40 percent shortly after trading started.
Shell Midstream Partners LP, structured as a tax-advantaged master limited partnership, debuted Wednesday morning on the New York Stock Exchange under the symbol SHLX. The offering priced at $23, above the anticipated range of $19 to $21 per unit. Soon after, the units were trading at $32.40.
The offering raised about $920 million for the company. The shares sold represent an about 29 percent limited interest in Shell Midstream that could rise to around 33 percent if the underwriters exercise an option to purchase more. Royal Dutch Shell and subsidiaries own the remaining interest.
Shell Midstream Partners holds stakes in in four pipelines — two that transport crude and two that transport refined products — focused on the the U.S. Gulf Coast.
The crude pipelines link onshore and offshore production to refining markets, while the refined product pipelines connect the Gulf Coast and southeast refineries to demand centers from Alabama to New York, according to a description of the assets filed with the U.S. Securities and Exchange Commission.
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