Western Refining, Inc. (NYSE:WNR) Acquires 38.7% Stake For $775M

Posted by Lacee Page November 13, 2013 0 Comment 1224 views

Western Refining, Inc. (NYSE:WNR) is acquiring 38.7% partnership interest in Northern Tier Energy LP (NYSE:NTI) and will be financing through a $550 million term loan arranged by Bank of America Corp (NYSE:BAC) and UBS AG (NYSE:UBS). The banks will be hosting a lender meeting tomorrow on Thursday, November 14, 2013 towards syndicating the debt to investors.

The Acquisition

Western Refining, Inc. (NYSE:WNR) will be acquiring this stake from Acon Investments and TPG Capital, one of the world’s largest private equity firms. The transaction was signed on November 12, 2013. Following the transaction, Western Refining, Inc. (NYSE:WNR) now owns 100% of the general partner and 38.7% of Northern Tier Energy LP (NYSE:NTI).

Northern Tier Energy LP (NYSE:NTI) owns a refinery in St. Paul Park, Minnesota and also holds 17% stake in crude oil pipeline. The St. Paul Park refinery has pipeline access to cost advantaged crude and refined resources regions that offers lucrative long term growth opportunities. The company also operates 163 convenience stores as well as supports 73 franchised stores under the brand Super America, mainly in Minnesota and Wisconsin.

Financing the Acquisition

The transaction would cost Western Refining, Inc. (NYSE:WNR) about $775 million. The company will finance the deal through $550 million term loan and $245 million from the cash available with the company. The person with knowledge of this transaction mentioned that this seven year term loan has no financial maintenance requirements.

The CEO Speak

The President and Chief Executive Officer of Western Refining, Inc. (NYSE:WNR), Jeff Stevens said in a statement, “This investment further enhances our strategic goal of expanding our refining presence in areas with direct pipeline access to cost-advantaged crude oil resources.”

The President and Chief Executive Officer of Northern Tier Energy LP (NYSE:NTI), Hank Kuchta said, “We are excited to welcome Western Refining as a new strategic partner and investor that is committed, as much as we are, to Northern Tier Energy’s long-term success.”

About Lacee Page

Lacee Page is our White House and political campaign reporter. Lacee also covers justice and national law enforcement issues and congressional reporter focusing on the outputs of the legislative process: government spending, agency regulation and congressional oversight. Lacee received a national Edward R. Murrow for spot news award and the regional Associated Press award for best newscast. Lacee attended Riverview High School near Coshocton, and graduated from Ashland College in Ashland, Ohio with a Bachelor of Arts degree in Communications.

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