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MarkWest Energy Partners LP (MWE - Analyst Report), processor and distributor of natural gas, will sell about 4,750,000 common units for a consideration of approximately $301.15 million. M&R MWE Liberty, LLC will sell an additional 250,000 common units. The closure of this offering is expected by Dec 23.

Citigroup Global Markets Inc., the US-based brokerage and securities arm of banking behemoth Citigroup Inc. (C - Analyst Report), will act as the sales agent for this transaction and has been given a 30-day option to buy additional 712,500 common units from MarkWest and 37,500 common units from M&R MWE Liberty.

MarkWest plans to use the proceeds to settle part of its debt, finance its capital expenditure programs and acquisitions as well as for other general partnership purposes. However, the company will hold no part in the proceeds generated from the sale of units by M&R MWE Liberty.

Denver, Colorado-based MarkWest Energy, a master limited partnership, is engaged in the gathering, processing and transmission of natural gas, transportation, fractionation and storage of NGLs, and the gathering and transportation of crude oil.

The partnership is one of the largest processors of natural gas in the Appalachian region and has a significant presence in the other prolific natural gas producing U.S. basins, including the Anadarko, Arkoma, East Texas and Gulf Coast basins.

Acquisitions have historically played a major role in the partnership’s growth profile and are expected to remain significant. However, MarkWest Energy may find it difficult to complete accretive transactions in the future, which could negatively impact its growth rate.    

MarkWest Energy currently carries a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. equity market over the next one to three months.

Meanwhile, one can consider better-ranked energy sector stocks such as Abraxas Petroleum Corp. (AXAS - Snapshot Report) and Harvest Natural Resources Inc. (HNR - Snapshot Report). Both these stocks presently sport a Zacks Rank #1 (Strong Buy).
 

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