tygnq.htm

 



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


 
FORM N-Q
 
 
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY
 




Investment Company Act file number 811-21462



Tortoise Energy Infrastructure Corporation
(Exact name of registrant as specified in charter)



11550 Ash Street, Suite 300, Leawood, KS 66211
(Address of principal executive offices) (Zip code)



Terry Matlack
Diane Bono
11550 Ash Street, Suite 300, Leawood, KS 66211
(Name and address of agent for service)



913-981-1020
Registrant's telephone number, including area code



Date of fiscal year end: November 30


Date of reporting period:  August 31, 2014
 
 
 
 
Item 1. Schedule of Investments.
 
Tortoise Energy Infrastructure Corporation
            
SCHEDULE OF INVESTMENTS (Unaudited)
            
               
     
August 31, 2014
  
     
Shares
    
Fair Value
  
Master Limited Partnerships and Related Companies - 176.6% (1)
        
Crude/Refined Products Pipelines - 80.5% (1)
            
United States - 80.5% (1)
            
Buckeye Partners, L.P.
     3,287,305     $ 259,697,095  
Enbridge Energy Partners, L.P.
     4,164,999       151,272,764  
Genesis Energy L.P.
     657,863       36,642,969  
Holly Energy Partners, L.P.
     1,886,360       68,456,004  
Magellan Midstream Partners, L.P.
     4,802,097       403,040,001  
MPLX LP
     1,496,831       91,306,691  
NuStar Energy L.P.
     836,150       55,261,154  
Oiltanking Partners, L.P.
     1,806,646       88,688,252  
PBF Logistics LP
     225,000       5,616,000  
Phillips 66 Partners LP
     523,900       38,768,600  
Plains All American Pipeline, L.P. (2)
     7,006,910       419,924,116  
Rose Rock Midstream, L.P.
     240,511       14,668,766  
Sunoco Logistics Partners L.P.
     6,682,971       330,673,405  
Tesoro Logistics LP
     1,309,100       92,003,548  
Valero Energy Partners LP
     598,620       31,912,432  
 
               2,087,931,797  
Natural Gas/Natural Gas Liquids Pipelines - 63.7% (1)
                
United States - 63.7% (1)
                
Crestwood Midstream Partners LP
     2,371,165       55,390,414  
El Paso Pipeline Partners, L.P.
     1,476,131       61,348,004  
Energy Transfer Equity, L.P.
     2,184,000       132,459,600  
Energy Transfer Partners, L.P.
     3,181,261       182,763,445  
Enterprise Products Partners L.P.
     7,943,384       322,739,692  
EQT Midstream Partners, LP
     1,209,766       117,940,087  
Kinder Morgan Management, LLC (3)
     1,493,463       145,941,194  
ONEOK Partners, L.P.
     3,059,559       181,829,591  
Regency Energy Partners LP
     5,137,606       169,438,246  
Spectra Energy Partners, LP
     2,912,544       165,985,883  
Williams Partners L.P.
     2,161,200       114,565,212  
                1,650,401,368  
Natural Gas Gathering/Processing - 32.4% (1)
                
United States - 32.4% (1)
                
Access Midstream Partners, L.P.
     2,391,907       153,919,216  
DCP Midstream Partners, LP
     2,315,127       130,989,886  
EnLink Midstream Partners, LP
     2,362,263       73,206,530  
MarkWest Energy Partners, L.P.
     2,359,512       188,123,892  
Summit Midstream Partners, LP
     222,900       12,321,912  
Targa Resources Partners LP
     1,579,157       117,489,281  
Western Gas Partners LP
     2,123,900       164,581,011  
                840,631,728  
                   
Total Master Limited Partnerships and Related Companies (Cost $1,975,178,110)
             4,578,964,893  
                   
Common Stock - 0.7%(1)
                
Crude/Refined Products Pipelines - 0.7%(1)
                
United States - 0.7% (1)
                
Plains GP Holdings, L.P. (Cost $13,572,477)
     630,662       19,462,229  
                   
Short-Term Investment - 0.0% (1)
                
United States Investment Company - 0.0% (1)
                
Fidelity Institutional Money Market Portfolio - Class I, 0.05% (4) (Cost $120,665)
     120,665       120,665  
                   
Total Investments - 177.3% (1) (Cost $1,988,871,252)
             4,598,547,787  
                   
Interest Rate Swap Contracts - (0.0%) (1)
                
$135,000,000 notional - Unrealized Depreciation
             (742,216 )
Other Assets and Liabilities - (52.1%) (1)
             (1,349,892,812 )
Senior Notes - (20.2%) (1)
             (524,400,000 )
Mandatory Redeemable Preferred Stock at Liquidation Value - (5.0%) (1)
             (130,000,000 )
Total Net Assets Applicable to Common Stockholders - 100.0% (1)
           $ 2,593,512,759  
                   
                   
(1)
Calculated as a percentage of net assets applicable to common stockholders.
                
(2)
A portion of the security is segregated as collateral for the unrealized depreciation of interest rate swap contracts of $742,216.
  
(3)
Security distributions are paid-in-kind.
                
(4)
Rate indicated is the current yield as of August 31, 2014.
                

 
 
 

Various inputs are used in determining the fair value of the Company’s financial instruments.  These inputs are summarized in the three broad levels listed below:
 
    Level 1 – quoted prices in active markets for identical investments
    Level 2 – other significant observable inputs (including quoted prices for similar investments, market corroborated inputs, etc.)
    Level 3 – significant unobservable inputs (including the Company’s own assumptions in determining the fair value of investments)
 
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The following table provides the fair value measurements of applicable Company assets by level within the fair value hierarchy as of August 31, 2014.  These assets are measured on a recurring basis.

   
Fair Value at
                    
Description
  
August 31, 2014
    
Level 1
    
Level 2
    
Level 3
  
Assets
                        
Equity Securities:
                        
Common Stock(a)
   $ 19,462,229     $ 19,462,229     $ -     $ -  
Master Limited Partnerships and Related Companies(a)
     4,578,964,893       4,578,964,893       -       -  
Other Securities:
                                
Short-Term Investment(b)
     120,665       120,665       -       -  
Total Assets
   $ 4,598,547,787     $ 4,598,547,787     $ -     $ -  
Liabilities
                                
Interest Rate Swap Contracts
   $ 742,216     $ -     $ 742,216     $ -  
 
(a)  
 
All other industry classifications are identified in the Schedule of Investments.
(b)  
Short-term investment is a sweep investment for cash balances in the Company at August 31, 2014.

The Company did not hold any Level 3 securities during the period from December 1, 2013 through August 31, 2014.  The Company utilizes the beginning of reporting period method for determining transfers between levels.  There were no transfers between levels during the period ended August 31, 2014.

Valuation Techniques
In general, and where applicable, the Company uses readily available market quotations based upon the last updated sales price from the principal market to determine fair value.  This pricing methodology applies to the Company’s Level 1 investments. 

An equity security of a publicly traded company acquired in a private placement transaction without registration under the Securities Act of 1933, as amended (the “1933 Act”), is subject to restrictions on resale that can affect the security's fair value.  If such a security is convertible into publicly-traded common shares, the security generally will be valued at the common share market price adjusted by a percentage discount due to the restrictions and categorized as Level 2 in the fair value hierarchy.  If the security has characteristics that are dissimilar to the class of security that trades on the open market, the security will generally be valued and categorized as Level 3 in the fair value hierarchy.

Interest rate swap contracts are valued by using industry-accepted models which discount the estimated future cash flows based on a forward rate curve and the stated terms of the interest rate swap agreement by using interest rates currently available in the market, or based on dealer quotations, if available, and are categorized as Level 2 in the fair value hierarchy.
 
As of August 31, 2014, the aggregate cost of securities for federal income tax purposes was $1,436,078,985.  The aggregate gross unrealized appreciation for all securities in which there was an excess of fair value over tax cost was $3,162,468,802, the aggregate gross unrealized depreciation for all securities in which there was an excess of tax cost over fair value was $0 and the net unrealized appreciation was $3,162,468,802.

 
 
 

Item 2. Controls and Procedures.
 
(a)  
The registrant’s Chief Executive Officer and its Chief Financial Officer have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “1940 Act”)) are effective as of a date within 90 days of the filing date of this report, based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended.

(b)  
There was no change in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the registrant's last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
 
Item 3. Exhibits.
 
Separate certifications for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the 1940 Act (17 CFR 270.30a-2(a)) are filed herewith.

 
 
 
 
 
SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


  Tortoise Energy Infrastructure Corporation  
       
Date:  October 30, 2014
By:
 /s/ Terry Matlack  
    Terry Matlack  
    Chief Executive Officer  
       



Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

  Tortoise Energy Infrastructure Corporation  
       
Date: October 30, 2014
By:
  /s/ Terry Matlack  
    Terry Matlack  
    Chief Executive Officer  
       
  Tortoise Energy Infrastructure Corporation  
       
Date: October 30, 2014
By:
  /s/ P. Bradley Adams  
    P. Bradley Adams  
    Chief Financial Officer