With that John, I will turn it to you.
Thank you, Brooks, and thank you, everyone, for your attendance on the call today. From my perspective, today’s announcement is another step in a strategic progress that began when we announced we were going to IPO our Northeast natural gas business. That IPO completed in December structurally began the process of separating our two primary businesses.
Our objective as stated at the time was to ultimately create two focused MLPs with their own pools of capital and unique M&A opportunities.
In the process, we started the de-leveraging of NRGY and expect it to unlock the embedded value of our high-growth fee-based midstream business. The transaction we announced today accelerates that process.
We have been proponents of propane industry consolidation for some time. This transaction accomplishes participation in that for us. The combining of operations with Suburban Propane creates scale, geographic diversity and the efficiencies needed to be competitive in the propane industry.
Our investors will retain an investment in that business acquired by Suburban and participate in those synergies and Inergy will focus on growing our midstream business.
I want to take the next few minutes to talk about the propane transaction, what it means for us going forward, and then we will also discuss some detail around the distribution that we announced this morning at NRGY.
I’m going to start referring you to the slides here just for a minute. I’m looking at slide five which says Retail Propane Transaction Overview at the top. Just to kind of describe the transaction as announced. We’re selling our retail propane operations to Suburban Propane for $1.8 billion. The acquisition is financed through a $1.2 billion bond exchange and a combination of Inergy and our investors will receive $600 million worth of SPH units. As I mentioned, our unit holders will have an opportunity to participate in propane industry consolidation via that investment.