Natural gas is down but not out: Rice Midstream Partners sets terms for $500 million IPO

Rice Midstream Partners LP, an MLP formed by Rice Energy to own natural gas gathering pipelines in the Marcellus Shale, announced terms for its IPO on Monday. The Canonsburg, PA-based company plans to raise $500 million by offering 25 million shares at a price range of $19 to $21. At the midpoint of the proposed range, it would command a fully diluted market value of $1.2 billion. It originally filed for a $425 million IPO in November.

Parent Rice Energy (RICE) raised $924 million in January, and now trades just 8% above its offer price due to the recent selloff of oil and gas stocks as energy prices drop. Close peers Antero Midstream Partners LP (AM) and CONE Midstream Partners LP (CNNX) both trade below their first day close, though Antero and CONE are still up 11% and 22%, respectively, from their upsized IPOs.

Rice Midstream Partners LP, which was formed in 2014 and booked $37 million in predecessor sales for the 12 months ended September 30, 2014, plans to list on the NYSE under the symbol RMP. Barclays, Citi, Wells Fargo Securities, Goldman Sachs and RBC Capital Markets are the joint bookrunners on the deal. It is expected to price during the week of December 15, 2014.