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    Western Refining Launches IPO for Midstream Spinoff

    Newly formed company will own and operate a variety of logistics assets.

    EL PASO, Texas -- Western Refining Inc. received permission from the U.S. Securities and Exchange Commission to launch an initial public offering (IPO) of its Western Refining Logistics LP midstream division.

    Western Refining will soon issue 12.5 million units of its logistics spinoff, which will operate as a master limited partnership (MLP). The shares will trade on the New York Stock Exchange under the symbol WNRL.

    El Paso, Texas-based WNRL will own, operate, develop and acquire terminals, storage tanks, pipelines and other logistics assets. The common units being offered to the public will equal a 27.4-percent limited partner interest.

    The underwriters for the transaction, which include BofA Merrill Lynch and Barclays, will receive a 30-day window to purchase an additional 1.875 million shares, or 3.9 percent, of WNRL. The new company has yet to announce what the price of each IPO unit will be.

    To qualify for MLP status, a partnership must generate at least 90 percent of its income from what the Internal Revenue Service deems "qualifying" sources. These sources include activities related to the production, processing or transportation of oil, natural gas and coal.

    Several convenience and petroleum retailing companies have created MLPs that currently trade on the NYSE, including Speedway LLC parent company Marathon Petroleum Corp.; MAPCO Express parent Delek US Holdings Inc.; Alon USA Energy Inc.; Stripes parent Susser Holdings Corp.; Phillips 66; and Tesoro Corp. Valero Energy Corp. also filed a S-1 registration statement with the SEC on Sept. 20 to spin off its midstream business into an MLP.

    Western Refining Inc.'s retail division operates 222 convenience stores and gas stations under the GIANT, Mustang, Sundial and Howdy's banners.

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