Shares of Atlas Pipeline Partners LP (APL) jumped as much as 37 percent to $16.90 in early trading on Wednesday, the most in its 10-year history as a public company, after the natural-gas pipeline operator said it has entered into a definitive agreement to sell its Elk City facilities and processing system to Canada’s nr. 2 pipeline operator Enbridge Energy Partners (EEP) for $682 million in cash.
The transaction, which will eliminate all senior secured debt and significantly deleverages Atlas Pipeline’s balance sheet, is expected to close in the third or fourth quarter of the year.
“Over the past several quarters, APL’s management team has communicated that it was evaluating strategies that would improve the Partnership’s balance sheet, grow its strategic asset base, and allow for the resumption of distributions to our unitholders. We believe this transaction accomplishes all those objectives and provides a balanced approach to debt reduction,” Eugene Dubay, the Partnership’s Chief Executive Officer, said in a statement.
Atlas gained $3.77, or 30.53%, to $16.12 at 12:01 ET in New York Stock Exchange trading. Enbridge Energy declined 71 cents, or 1.22 percent, to $56.90.