S&P affirms Magellan Midstream

Standard & Poor's said it affirmed its BBB corporate credit rating on Magellan Midstream Partners LP and removed the rating from CreditWatch with negative implications.

S&P also affirmed its ratings on Magellan Midstream Holdings LP and Magellan Pipeline Co. LLC and removed the ratings from CreditWatch with negative implications. The outlook is stable.

The ratings were originally placed on CreditWatch June 25 to reflect Magellan's announced acquisition of more than 2,000 miles of refined petroleum products pipeline infrastructure from Shell Oil Co. for $492.4 million ($530 million including inventories). Magellan initially funded the acquisition with cash on hand and bank borrowings and the CreditWatch primarily reflected the execution risk associated with the issuance of equity for the acquisition. Magellan completed its equity offering on Oct. 8.

S&P rates Magellan Midstream Holdings LP's $200 million senior secured bank loan due 2008 at BB and Magellan Pipeline Co. LLC's $302 million senior unsecured notes due 2007 at BBB.

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