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Valero Energy gains as unit files for $345 mln IPO

Published: 11:56 20 Sep 2013 BST

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Valero Energy Corp. (NYSE:VLO), the world’s largest independent refining company, advanced in after-hours trades yesterday after a master limited partnership it formed filed to raise $345 million in an initial public offering.

The shares gained 1.1 percent to $35.10 at 7:50 p.m. in New York. They had dropped 1 percent at the 4 p.m. close, leaving the company with a market value of $18.83 billion. 

Valero Energy Partners LP was formed in July by the San Antonio, Texas-based refinery operator to own, operate and develop pipelines, terminals and other transportation and logistics assets. Its initial assets include properties in the Gulf Coast and Midwest that are integral to operating Valero's refineries in Texas and Tennessee.

Valero Energy Partners expects to start the IPO early next year. The number of shares to be offered and the price haven't yet been determined.

The company said it plans to use proceeds from the offering to pay revolving credit line fees and fund potential acquisitions.

Valero Energy Partners makes money by charging tariffs and fees for transporting crude oil and refined petroleum products, and reported revenue of $84.4 million last year. It will sign 10-year agreements with its parent company when the IPO is completed, according to regulatory documents.

 JP Morgan and Barclays have been listed as underwriters to the offering.

The stock is expected to trade under the ticker symbol "VLP" on the New York Stock Exchange.

 

 

 

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