TPC Group signs merger agreement with First Reserve, SK Capital

27 August 2012 15:34  [Source: ICIS news]

HOUSTON (ICIS)--Butadiene producer TPC Group and global energy industry investment firm First Reserve and chemical sector investment firm SK Capital reached a merger agreement, TPC said on Monday.

Under the agreement, TPC will become a private company. The transaction is expected to close in the fourth quarter.

TPC Group is a major provider of butadiene (BD) to the US market.

The investment funds were sponsored by First Reserve.

The transaction is valued at about $850m (€680m), including net debt.

The TPC Group stockholders will receive $40 per share in cash for each share of TPC Group common stock that they own.

The share consideration includes a 20% premium to the closing stock price on July 24, which was the last unaffected trading day prior to the media reports of a possible acquisition of TPC Group.

“We are committed to the execution of our near- and long-term strategic initiatives and remain on schedule with our projects,” TPC CEO Michael McDonnell said in a press release.

Jack Norris, a managing director of SK Capital, said “We firmly believe in management’s strategy of enhancing TPC Group’s ability to serve customers in structurally short markets through the restart of idled assets. Partnering with First Reserve in the acquisition leverages the strengths of our respective sector franchises and positions us well to support management’s growth initiatives.”

The transaction is subject to the approval of TPC Group’s stockholders, anti-monopoly clearances and other customary closing conditions.

By: Wesley Busch
+1 713 525 2653

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