Monday, June 9, 2014

Seeking Alpha: Can New Ownership Add A Spark To TransMontaigne Partners LP?

Change can be a scary thing for a business like TransMontaigne Partners LP (TLP), whose terminaling and storage operations generally thrive on consistency. With Morgan Stanley's (MS) Morgan Stanley Capital Corp. closing in on a sale of its GP interest in the MLP (and likely its stake in the LP units as well), though, investors should hope that a motivated new owner can do more with these assets and bring in some growth.

Up roughly 20% move over the last three months, I don't think TransMontaigne has been trading just on the prospects of new ownership. Other terminal operators like Magellan Midstream Partners LP (MMP), Sunoco Logistics Partners LP (SXL), and NuStar Energy LP (NS) have also been enjoying strong interest over the last few months. The MLP sector as a whole has been seeing better fundamentals (good first quarter earnings), low interest rates, and a fair bit of structural activity, with M&A picking up and multiple announcements regarding repurposing and converting infrastructure assets. Against that backdrop, I don't see TransMontaigne Partners as a particularly interesting MLP from a value perspective, but the sale process could put the company on a better long-term path.

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Can New Ownership Add A Spark To TransMontaigne Partners LP?

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