The stock of Energy Transfer LP (ET) slightly declined in the Pre-market after the company announced their pricing of a secondary public offering of common units. The stock was valued in the pre-market at $8.29 losing 0.84% from the previous day’s closing. At the end of the last trading session, the stock closed at $8.18. The average volume of the stock traded in the last trading session was around 18.01 million.
The reason for the ET stock decline
On 7th December 2021, Energy Transfer LP (ET) stock announced that they are starting the underwritten secondary public offering that consists of 86,956,522 common units. This represents the limited partner interests in Energy Transfer (ET). The selling unitholder is announced to be CenterPoint Midstream Energy, Inc. (which is a subsidiary of CenterPoint Energy, Inc.).
Today on 8th December 2021 Energy Transfer LP (ET) stock announced the pricing of the lastly announced underwritten public offering. The price of the 86,956,522 common was set for the gross proceedings of $665 million. The deal is expected to settle on 10th December 2021.
The representatives of the underwriters Citigroup, J.P. Morgan, and Morgan Stanley will be granted a 30-day option to purchase 13,043,478 additional common units in the offering by the Selling Unitholder. The company itself is not selling any of the common units and nor it intends to receive anything from the sale of the common units in the offering. The offering is totally dependent on the market and other factors, and there is no specific time announced that as to whether or when the offering will be completed.
Effect on the stock
After this announcement, the stock of the company slightly lost its value. The investors were seen to be quite reluctant in investing in the stock of Energy Transfer LP (ET). The stock of the company was doing well, when the company in the last week announced their completion of Acquisition of Enable Midstream. The Combined operations were announced to be forecasted to generate an annual cost reduction of more than $100 million. Due to which the investors were highly interested in its future profitability.
Conclusion
The trend of the stock will be decided after any major development in the offering. The offer is expected to settle on 10th December 2021, till then the trend of the stock could remain certain.
