BRENTWOOD, Tenn. -- Delek US Holdings Inc. said it has entered into agreements with several shareholders of Lion Oil Co. to acquire a minority equity interest of 28.3% in Lion Oil. Total cash consideration paid to the selling shareholders will equal approximately $65.4 million in the aggregate. The terms of one of the transactions also call for Delek to issue 1,916,667 shares of Delek US Holdings common stock to TransMontaigne Inc., a wholly owned subsidiary of Morgan Stanley Capital Group Inc.
The transactions are subject to obtaining a certain minimum [image-nocss] equity ownership position in Lion Oil, as well as other customary closing conditions and government approvals. The transactions are anticipated to close during the third quarter of this year.
Lion Oil, a privately held company, owns and operates a 75,000 barrel-per-day, high-conversion crude oil refinery in El Dorado, Ark., three crude oil pipelines and two refined petroleum products terminals in Memphis and Nashville, Tenn. The two terminals supply products to some of Delek's 188 convenience stores in the Memphis and Nashville markets.
Uzi Yemin, president and CEO of Delek US, said, The assets of Lion Oil fit well with our operations, and we expect this investment to immediately enhance the earnings of Delek. This agreement establishes a relationship between Delek and Morgan Stanley Capital Group Inc. and a Morgan Stanley Capital Group Inc. affiliate.
Brentwood, Tenn.-based Delek US Holdings is a diversified energy business focused on petroleum refining, marketing and supply of refined products, and retail marketing of fuel and general merchandise. The refining segment operates a high-conversion, independent refinery with a design crude distillation capacity of 60,000 barrels per day, in Tyler, Texas. The marketing and supply segment markets refined products through its terminals in Abilene, Texas, and San Angelo, Texas, as well as other third-party terminals. The retail segment markets gasoline, diesel and other refined petroleum products and convenience merchandise through a network of company-operated retail fuel and convenience stores, operated under the MAPCO Express, MAPCO Mart, East Coast, Discount Food Mart, Fast Food and Fuel and Favorite Markets brand names.
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