This morning Proven Reserves recommendation Enterprise Products Partners LP (NYSE: EPD) announced that it will acquire its general partner, Enterprise GP Holdings (NYSE: EPE), in a deal worth $8 billion. Investors in Enterprise GP Holdings will receive 1.5 units of Enterprise Products Partners for each for each unit held. The GP will become a division of Enterprise Products Partners.

Enterprise GP Holdings controls the general partner for both Enterprise Products Partners and fellow Proven Reserves recommendation Duncan Energy Partners LP (NYSE: DEP). A general partner manages the day-to-day operation of a master limited partnership (MLP) in exchange for a fee known as incentive distribution rights (IDR).

The amount of the IDR paid out depends on the distributions disbursed to common unitholders. In other words, the fee paid to Enterprise GP Holdings would grow as distributions to Enterprise Products Partners increase. Each MLP calculates IDRs in a slightly different way; in the case of Enterprise Products Partners, its GP received 15 to 16 percent of the MLP’s cash flows in the most recent quarter.

Units of Enterprise Products Partners traded lower after the deal was announced, primarily because the MLP will pay a premium of roughly 16 percent based on Enterprise GP Holdings’ closing price on Friday. This dip is a classic buying opportunity.

Enterprise Products Partners isn’t the first MLP to acquire its GP. Magellan Midstream Partners LP (NYSE: MMP) made the same move last year and eliminated IDRs. The deal has proved an undeniable positive for Magellan and reduced the partnership’s cost of capital. No longer required to pay IDRs, LP unitholders now get to keep all of the cash generated by the business. Higher cash flows have enabled Magellan Midstream Partners to pursue organic growth projects and make acquisitions that also boost the distributions paid to unitholders.

Enterprise Products Partners has always been an industry leader in terms of creating value for unitholders; for example, the MLP was among the first to slash its IDR structure a few years ago, a strategy that several of its peers followed. Buy Enterprise Products Partners LP under 38.