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TEXT-S&P: Energy Transfer Equity rating unaffected by asset sale
December 17, 2012 / 10:50 PM / in 5 years

TEXT-S&P: Energy Transfer Equity rating unaffected by asset sale

Dec 17 - Standard & Poor's Ratings Services said today that Energy Transfer
Equity L.P.'s  (ETE; BB/Stable/--) and Energy Transfer Partners L.P.'s
 (ETP; BBB-/Stable/--) announcement that it has entered into an agreement
with The Laclede Group Inc. (A/Stable/--) to sell natural gas utility
assets of Southern Union Co. (SUG; BBB-/Stable/--), will not affect ETE's, ETP's
and SUG's ratings. The ratings are not affected because we factored the sale of
these assets to reduce consolidated leverage into our analysis in late March
2012 when ETE closed its purchase of SUG and when ETP completed the formation of
a new ETP-controlled company that includes SUG and Sunoco Inc. (not rated ) on
Oct. 5, 2012. The sale of SUG's gas utilities (about 10% of SUG's EBITDA), which
include Missouri Gas Energy (MGE) and New England Gas Co. (NEG) divisions, is
for about $1.035 billion, consisting of $1.015 billion in cash and $20 million
of NEG debt. 

We expect ETE to deleverage its balance sheet, with stand-alone and 
consolidated debt to EBITDA of about 3.5x and the low 5x area, respectively, 
in 2013. We expect SUG to execute its organic growth strategy, mainly related 
to its gathering and processing business segment and maintain debt to EBITDA 
in the mid-4x area in 2013.

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