Targa Resources Partners LP will buy the natural gas liquids logistics and marketing business off its parent Targa Resources, Inc. for $530 million.

Moody's ratings service said the transaction would impact on approximately $1.8 billion of securities and emphasized the outlook for both companies was stable. Both Targa Resources, Inc. and Targa Resources Partners LP have headquarters in Houston.

The downstream business being acquired by Targa Resources Partners LP includes the logistics assets, natural gas liquids distribution networks and marketing and wholesale marketing elements, said the sources.

The deal is the third in what is expected to be a series of drop-downs of assets by TRI to the partnership.

Moody's issued its assessment after announcement of the deal, pointing out that $397.5 million of the transaction total consists of debt and $132.5 million is made up of limited partnership units issued to TRI.

Moody's cited the Partners' scale and diversification across the midstream value chain offset by its growing leverage and greater distribution burden to its parent, TRI.

Partners is acquiring largely fee-based businesses strategically located in the "must-run" portion of the natural gas value chain. Partners' acquired assets include three fractionation facilities that total 380 million barrels a day gross capacity.

Also included in the deal are terminalling and storage facilities, and transportation and distribution services throughout the Gulf Coast area.

Targa Partners said in a news release the transaction, which is subject to standard closing conditions, was expected to close in the third quarter of 2009.

Barclays Capital, Inc. acted as a financial adviser to the Partnership and Wells Fargo Securities, LLC acted as a financial adviser to Targa.

Targa Resources Partners was formed by Targa to engage in the business of gathering, compressing, treating, processing and selling natural gas and fractionating and selling natural gas liquids and natural gas liquids products.

The partnership owns an extensive network of integrated gathering pipelines, seven natural gas processing plants and two fractionators and operates in southwest Louisiana, the Permian Basin in West Texas and the Fort Worth Basin in North Texas. A subsidiary of Targa is the general partner of Targa Resources Partners.