October 20, 2014 / 3:06 PM / 3 years ago

UPDATE 1-Shell Midstream Partners expects IPO to be priced at $19-$21/unit

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Oct 20 (Reuters) - Shell Midstream Partners LP IPO-SHLX.N, a master limited partnership formed by Royal Dutch Shell Plc , said it expected its initial public offering of common units to be priced at $19-$21 per unit, valuing it at up to $1.42 billion.

The Houston-based company's offering of 37.5 million units will raise $787.5 million at the top end of the expected range. (1.usa.gov/1t3Icn9)

A number of master limited partnerships (MLPs), including PBF Logistics LP, Viper Energy Partners LP and GasLog Partners LP, have listed this year.

Shell Midstream owns stakes in four onshore and offshore pipelines in Texas and Louisiana.

This includes a 43 percent stake in a crude oil pipeline connecting Houston to Houma, a 28.6 percent stake in a pipeline to the offshore Mars field in the Gulf of Mexico, and a 49 percent stake in a refined products pipeline linked to four Louisiana refineries.

The MLP structure allows companies to raise money in the stock market while having income taxed only at the unit holder level, avoiding corporate income taxes.

MLPs that hold midstream assets, such as pipelines and storage facilities, have found favor with investors since they distribute most of their earnings to shareholders.

Shell Midstream's revenue jumped 57 percent to $79.5 million in the six months ended June 30. Net income more than tripled to $41.4 million.

The company said it planned to list its units on the New York Stock Exchange under the symbol "SHLX".

Barclays and Citigroup are among the lead underwriters for the IPO. (Reporting by Neha Dimri in Bangalore; Editing by Kirti Pandey)

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