MarkWest Energy Partners, L.P.
Robbins Arroyo LLP: Acquisition of MarkWest Energy Partners, L.P. (MWE) by MPLX LP (MPLX) May Not Be in Unitholders’ Best Interests
Robbins Arroyo LLP is investigating the proposed acquisition of MarkWest Energy Partners, L.P. (NYSE: MWE) by MPLX LP (NYSE: MPLX). On July 13, 2015, the two companies announced the signing of a definitive merger agreement pursuant to which MPLX will acquire MarkWest. Under the terms of the agreement, MarkWest unitholders will receive 1.09 MPLX common units and $3.37 in cash for each unit of MarkWest, for a total consideration of $78.64.
Is the Proposed Acquisition Best for MarkWest and Its Unitholders?
Robbins Arroyo LLP’s investigation focuses on whether the board of directors at MarkWest is undertaking a fair process to obtain maximum value and adequately compensate its unitholders.
The $78.64 merger consideration is significantly below the target price of $86.00 set by an analyst at Ladenburg Thalmann & Co. on April 13, 2015, and $81.00 set by analysts at Stephens Inc. and Credit Suisse on December 29, 2014 and May 6, 2015, respectively. In the last three years, MarkWest traded as high as $80.79 on September 2, 2014, and most recently traded above the merger consideration – at $80.48 – on September 19, 2014.
On May 6, 2015, MarkWest reported strong earnings results for its first quarter 2015. Quarterly cash available for distribution to common unitholders was $180.3 million, a 21% increase over the previous comparable quarter. Adjusted EBITDA was $229.7 million, a 22% over the same period in 2014. In commenting on these results, MarkWest Chairman, President, and Chief Executive Office Frank Semple remarked, “2015 is off to a great start and our first quarter results highlight the strength of our business model and resiliency of producers’ development in America’s most economic resource plays. Our producer customers continue to adjust their drilling programs based on the lower commodity price environment and we are optimizing our capital program to provide just-in-time processing and fractionation capacity to support the producers’ revised volume forecasts. As a result, our Marcellus and Utica processing plant utilization is approaching 90 percent, which improves both our operational and financial performance. There are exceptional opportunities for the ongoing development of critical energy infrastructure in our core operating areas and we will continue to focus on providing outstanding service and support for our producer customers and long-term value for our unitholders.”
In light of these facts, Robbins Arroyo LLP is examining MarkWest’s board of directors’ decision to sell the company now rather than allow unitholders to continue to participate in the company’s continued success and future growth prospects.
MarkWest unitholders have the option to file a class action lawsuit to ensure the board of directors obtains the best possible price for unitholders and the disclosure of material information.
MarkWest unitholders interested in information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, or you can complete the form below and we will contact you directly.