Tallgrass Energy Partners, LP (ticker TEP) is currently out on its IPO roadshow and looking to raise $287 million by selling 13.05 million common units (before the over-allotment) at a mid-point price of $22 with an indicated mid-point yield of 5.2%. They expect to price the deal tonight May 13.
- Here is the full roadshow presentation in pdf format (click to open): TEP IPO Roadshow Slides May 2013
- Here is a link to the roadshow video (it will be removed tonight once the IPO prices): TEP Roadshow Video
- Here is a link to their SEC filings: TEP SEC Filings
IMPORTANT: TEP will provide investors with a K-1 (instead of a 1099-DIV), which makes TEP appropriate for taxable accounts. Here is the key language from the “Material Federal Income Tax Consequences” section of the Prospectus (page 209) telling you that it does not belong in an IRA:
Tax-Exempt Organizations and Other Investors
Ownership of units by employee benefit plans, other tax-exempt organizations, non-resident aliens, foreign corporations and other foreign persons raises issues unique to those investors and, as described below to a limited extent, may have substantially adverse tax consequences to them. If you are a tax-exempt entity or a non-U.S. person, you should consult your tax advisor before investing in our common units.
Employee benefit plans and most other organizations exempt from federal income tax, including individual retirement accounts and other retirement plans, are subject to federal income tax under Section 511 of the Code on unrelated business taxable income. Virtually all of our income allocated to a unitholder that is a tax-exempt organization will be unrelated business taxable income and will be taxable to it. Please read “Investment in Tallgrass Energy Partners, LP By Employee Benefit Plans.”
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