Fitch lifts Kinder Morgan

Fitch Ratings said it upgraded Kinder Morgan Inc.’s long-term issuer default rating and senior unsecured ratings to BBB- from BB+.

The upgrade follows news that Kinder Morgan has received unitholder approval and expects to close a transaction Nov. 26 that will merge Kinder Morgan, Kinder Morgan Management, LLC and El Paso Pipeline Partners, LP in a transaction valued at more than $71 billion.

The deal effectively rolls Kinder Morgan’s partnership subsidiaries into a more traditional taxpaying corporate structure, Fitch said.

Fitch also said it assigned an F3 short-term issuer default rating and commercial-paper rating to Kinder Morgan.

Fitch also downgraded Kinder Morgan Energy Partners, LP’s long-term issuer default rating and senior unsecured rating to BBB- and affirmed El Paso Pipeline Partners Operating Co. LLC’s long-term issuer default rating and senior unsecured ratings at BBB-.

The outlook is stable.

The actions reflect the agency’s consolidated ratings approach to Kinder Morgan and its various subsidiaries based on its plan to put in place cross guarantees among and between the Kinder Morgan entities in order to create a single-creditor class and virtually eliminates structural subordination, Fitch said.

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