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As another Seeking Alpha contributor pointed out, high levels of debt and the possibility of a conversion from an MLP into a C Corp, similar to what Kinder Morgan (NYSE:KMI) engaged in a few years back that resulted in negative tax consequences for common shareholders, are legitimate reasons for a low trading multiple.Given this change to the company's cash flow projections, it makes sense that risks associated with the business' leverage are higher now. In addition, if there ever was a probability of the firm's management team allowing the entity to be rolled up into Enbridge Inc. (NYSE:ENB), that probability is now higher because of the loss of a valuable tax benefit that it could get back if it were a C Corp.
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