MOSCOW (MRC) -- Flint Hills Resources, LLC announced it is moving forward with a significant expansion of its chemicals business with the completion of its acquisition of PetroLogistics LP and its general partner, PetroLogistics GP LLC, said the producer in its press release.
The USD2.1 billion transaction is the largest in the company’s history and the first chemical asset it has acquired since purchasing Huntsman Corporation’s U.S. commodity chemical business in 2007.
The acquisition was finalized through the merger of Flint Hills Resources’ subsidiary, FHR Propylene, LLC, with and into PetroLogistics. As a result of the merger, all of PetroLogistics’ outstanding common units were converted into the right to receive USD14.00 per common unit in cash, except for those common units owned by Lindsay Goldberg LLC, York Capital Management, MLP GP’s Executive Chairman and its President and Chief Executive Officer, which were acquired for USD12.00 per common unit in cash.
Flint Hills Resources will operate PetroLogistics’ propylene facility, which is located in Houston, as part of its chemical and refining business.
PetroLogistics began operations in 2010 and has an annual production capacity of approximately 1.45 billion pounds. Propylene is one of the basic building blocks for petrochemicals and is used in the production of a variety of end uses including paints, coatings, building materials, clothing, automotive parts, packaging and a range of other consumer and industrial products.
Flint Hills Resources is a leading refining, chemicals and biofuels company with operations primarily in Texas and the Midwest. Its manufacturing capability is built upon six decades of refining experience. The company has expanded its production capacity through acquisitions and capital projects worth more than USD8.6 billion since 2002. Flint Hills Resources is a subsidiary of Koch Industries Inc., one of America’s largest private companies. As a result of the merger, PetroLogistics will cease to be a publicly traded company and its common units will no longer be traded on the New York Stock Exchange or any other securities exchange.
PetroLogistics is a major producer of propylene with operations in the vicinity of the Houston Ship Channel. The company owns and operates the only propane dehydrogenation facility in the US, and its plant is among the largest of its kind in the world. The facility employs about 100 people.
Flint Hills Resources, through its subsidiaries, is a leading refining, biofuels and chemicals company. Its subsidiaries market products such as gasoline, diesel, jet fuel, ethanol, biodiesel, olefins, polymers and intermediate chemicals, as well as base oils and asphalt.
MRC