NEW YORK (TheStreet) -- Shares of Eagle Rock Energy Partners, L.P (EROC) are down -16.08% to $4.07 on Thursday after the company announced it's suspending its quarterly distribution "in order to preserve liquidity in advance of closing the contribution of its midstream business to Regency Energy Partners (RGP)."
The company, which is a limited partnership that operates in the business of gathering, compressing, treating, processing and transporting natural gas, reported on Feb. 27, 2014 that the FTC requested additional information regarding the midstream business contribution.
"This has extended management's original time frame for closing the transaction and created the need to preserve greater liquidity in the interim to fund growth capital expenditures and other financial obligations,' Eagle Rock said.
"In our view, the distribution suspension is a negative and another blow to weary [Eagle Rock] investors that already endured a previous cash distribution cut and unit price under performance," said Bank of America (BAC) in a report published Thursday in which the firm reiterated a neutral rating on the company.
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TheStreet Ratings team rates EAGLE ROCK ENERGY PARTNRS LP as a Sell with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:
"We rate EAGLE ROCK ENERGY PARTNRS LP (EROC) a SELL. This is driven by some concerns, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, generally high debt management risk, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself."