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Delek US $DK to Acquire Remaining 53% Stake in Alon USA $ALJ for $464M

Delek US $DK to Acquire Remaining 53% Stake in Alon USA $ALJ for $464M

Delek US currently owns approximately 33.7 million shares of common stock of Alon, which it agreed to acquire in April 2015, as reported by ExitHub. In July 2016, Alon USA retained J.P. Morgan as its financial advisor, and Gibson Dunn as its legal advisor, to explore an exit for the company. Based on a closing price of $24.07 per share for Delek US common stock on Friday, December 30, 2016, the implied price for the Alon common stock is $12.13 per share. The owners of the remaining outstanding shares in Alon that Delek US does not currently own will receive a fixed exchange ratio of 0.5040 Delek US shares for each share of Alon. This represents a 5.6 percent premium to the 20 trading day volume weighted average ratio through and including December 30, 2016, of 0.477. Upon closing, the combined company will be primarily led by Delek US’ management team. The combined company will have a broad platform consisting of refining, logistics, retail, wholesale marketing, as well as renewables and asphalt operations. The refining system will have approximately 300,000 barrels per day of crude throughput capacity consisting of four locations and an integrated retail platform that includes 307 locations serving central and west Texas and New Mexico. Logistics operations include Delek Logistics which can benefit from future drop downs and organic projects to support a larger refining system. This combination will create a larger marketing operation with 600,000 barrels per month of space on the Colonial Pipeline System and a wholesale business with over 1.2 billion gallons of sales volume annually in the southwest. Alon USA Energy, headquartered in Dallas, Texas, is an independent refiner and marketer of petroleum products, operating primarily in the South Central, Southwestern and Western regions of the United States. Alon owns 100% of the general partner and 81.6% of the limited partner interests in Alon USA Partners, LP (NYSE: ALDW), which owns a crude oil refinery in Big Spring, Texas, with a crude oil throughput capacity of 73,000 barrels per day and an integrated wholesale marketing business. In addition, Alon directly owns a crude oil refinery in Krotz Springs, Louisiana, with a crude oil throughput capacity of 74,000 barrels per day. Alon also owns crude oil refineries in California, which have not processed crude oil since 2012. Alon owns a majority interest in a renewable fuels project in California, with a throughput capacity of 2,500 barrels per day. Alon is a leading marketer of asphalt, which it distributes primarily through asphalt terminals located predominately in the Southwestern and Western United States. Alon is the largest 7-Eleven licensee in the United States and operates approximately 300 convenience stores which also market motor fuels in Central and West Texas and New Mexico. Delek US Holdings is a diversified downstream energy company with assets in petroleum refining and logistics. The refining segment consists of refineries operated in Tyler, Texas and El Dorado, Arkansas with a combined nameplate production capacity of 155,000 barrels per day. Delek US Holdings, Inc. and its affiliates also own approximately 62 percent (including the 2 percent general partner interest) of Delek Logistics Partners, LP. Delek Logistics Partners, LP (NYSE: DKL) is a growth-oriented master limited partnership focused on owning and operating midstream energy infrastructure assets. Delek US Holdings, Inc. currently owns approximately 47 percent of the outstanding common stock of Alon USA Energy, Inc. (NYSE: ALJ). “We are excited to reach this agreement and believe this strategic combination will result in a larger, more diverse company that is well positioned to take advantage of opportunities in the market and better navigate the cyclical nature of our business,” said Uzi Yemin, Chairman, President and Chief Executive Officer of Delek US. “We expect to be able to achieve meaningful synergies across the organization and the combination will create a refining system that will be one of the largest buyers of crude from the Permian Basin among the independent refiners. Additionally, we expect the combined company will have the ability to unlock logistics value from Alon’s assets through future potential drop downs to Delek Logistics Partners and create a platform for future logistics projects to support a larger refining system,” he added. “We are excited to be joining Delek US and believe this agreement represents an excellent opportunity for Alon’s shareholders,” said David Wiessman, Chairman of Alon’s Special Committee. “The economies of scale, financial strength, and synergies generated through this merger create the opportunity to drive long-term value for shareholders and the all-stock transaction allows all shareholders to participate in the future performance of the combined company. I would like to thank Alon’s employees for their efforts, and our customers, suppliers and banks that supported our company, as we worked together to create value for our shareholders.” Wiessman is Chairman of Alon USA Partners. He is also Executive Chairman of Blue Square-Israel Ltd. (NYSE/TASE: BSI); and Executive Chairman and President of Dor Alon Energy Israel (1988) Ltd., which operates a chain of convenience stores and fuel supply in Israel and is listed on the Tel Aviv Stock Exchange. In 1994, Wiessman became Chief Executive Officer, President, and a Director of Alon Israel. Wiessman has also served as President and Chief Executive Officer of Alon from its formation in 2000 until May 2005, and as Executive Chairman from July 2000 to May 2015. In April this year, Alon Group, which is owned by Shraga Biran, David Wiessman, and a group of kibbutzim, was said to be considering an IPO on the Tel Aviv Stock Exchange as part of a 1.9 billion shekel debt settlement. Alon Group has experienced “a sweeping downward financial spiral at almost every level of its holdings pyramid in recent years (Alon Holdings Blue Square – Israel Ltd. (NYSE: BSI; TASE: BSI), the Mega retail chain), and has itself required a 2.2 billion shekel debt settlement,” said Globes. Most of the blame for the mess at Israel’s Mega supermarkets, which has been struggling with $360 million in debt, and has been in trouble for years, “goes to former CEO David Wiessman,” said Haaretz. However, in 2005 he was named “Israel’s Man of the Year.” In 1976, after serving in the Israeli Air Force, Wiessman became CEO and majority shareholder in Bielsol Group, a privately owned company that owns and operates gasoline stations and real estate in Israel. The transaction is expected to close in the first half of 2017 and is subject to customary closing conditions, including regulatory approval and approval by a majority of votes cast of Delek US shareholders and approval by the holders of a majority of the remaining 53 percent of Alon shares, which excludes the 47 percent of Alon shares owned by Delek US. Tudor, Pickering, Holt & Co. is serving as exclusive financial advisor on this transaction to Delek US. BofAMerrill Lynch and Barclays provided financial structuring advice to Delek US related to this transaction. Norton Rose Fulbright US LLP and Morris, Nichols Arsht & Tunnell LLP are serving as legal advisors for Delek US. J.P. Morgan is serving as exclusive financial advisor and Gibson Dunn & Crutcher LLP is serving as legal advisor for the Special Committee of Alon USA’s board of directors. Vinson & Elkins LLP is serving as legal advisor to Alon USA.]]>

Ben-Moshe Closes Buyout of Alon Blue Square Israel

Ben-Moshe Closes Buyout of Alon Blue Square Israel

Azrieli Group Ltd. (TASE: AZRG) received approval from the Israel Antitrust Commissioner for the sale of its gas station company Sonol, to David Wiessman‘s Israel Oil and Gas Fund, for 364 million shekels ($96 million). Sonol operates about 240 gas stations and more than 190 convenience stores throughout Israel. Wiessman, a former executive chairman of Alon Blue Square and Dor Alon Energy, serves as chairman of Alon USA Partners. In July, its Dallas, Texas-based affiliate Alon USA Energy Inc. (NYSE: ALJ) hired JPMorgan  to explore strategic alternatives including a potential sale of Alon USA Energy, whose largest shareholder with a stake of 48% is Delek US Holdings  (NYSE: DK). A few weeks ago, Delek US sold its own 348 MAPCO Express convenience stores in the US to Chile’s giant COPEC SA (SNSE: COPEC) for $535 million. Alon Blue Square’s Fueling and Commercial Sites segment develops and operates vehicle gas stations, adjacent commercial centers, and independent convenience stores. Its Tel Aviv Stock Exchange (TASE) listed 63.13% subsidiary Dor Alon Energy Israel (1988) Ltd., is one of the four largest fuel retail companies in Israel operating 211 gas stations and 220 convenience stores in different formats under the Alonit and Super Alonit, and AM:PM brands. Its Houseware and Textile segment operates as a retailer and wholesaler in houseware and textile activities. This segment operates 112 stores through its TASE traded 77.51% subsidiary, Na’aman Group (NV) Ltd., under the Naaman and Vardinon brands. Alon Blue Square’s Real Estate segment owns, leases, and develops commercial centers, logistics centers and offices, and land, as well as develops income producing commercial properties and projects, including wholesale market residency projects in Tel-Aviv through its TASE traded 53.92% subsidiary Blue Square Real Estate Ltd. Ben-Moshe is the founder and chairman of the Extra Group, based in Cologne, Germany. In 2014, Ben-Moshe acting in partnership with Argentine tycoon Eduardo Elsztain, acquired joint control of Israel’s biggest conglomerate IDB Group through a massive capital injection, after a heated battle with bondholders and previous controlling shareholder Nochi Dankner. In May 2015 he was forced out as co-chairman of IDB. In 2007 he started a private equity fund together with Dr. Barnim Jeschke, in order to invest in new technologies, focusing initially on the renewable energy sector. Between 2003-2007 he built a leading VoIP based network in Europe, in partnership with Telefonica Deutschland GmbH, and in cooperation with Cisco. In earlier years, after dropping out of Bar-Ilan University, he founded Cyber Gate, a software development company which developed billing systems and micropayment solutions, writing the computer program himself.]]>

Chilean Copec to Acquire Mapco C-Stores From Delek US $DK for $535M

Chilean Copec to Acquire Mapco C-Stores From Delek US $DK for $535M

Compañía de Petróleos de Chile COPEC SA (SNSE: COPEC) agreed to acquire MAPCO Express Inc. convenience stores from Delek US Holdings Inc. (NYSE: DK) for $535 million in cash. The deal has received unanimous approval of both boards of directors and is expected to close by year-end, subject to customary regulatory and closing conditions. COPEC will be fund the acquisition with cash on hand. Debt associated with the MAPCO retail assets, amounting to approximately $160 million at June 30, 2016, will be repaid at closing. As part of the deal, Delek will continue to supply fuel to certain MAPCO retail locations under an 18-month supply agreement. MAPCO is a leading convenience store chain with 348 corporate stores operating primarily in Tennessee, Alabama and Georgia, with an additional presence in Arkansas, Virginia, Kentucky and Mississippi. MAPCO operates company stores under the banners MAPCO Express, MAPCO Mart, East Coast, Fast Food and Fuel, Favorite Markets, Delta Express and Discount Food Mart. In addition, MAPCO provides fuel to 142 dealer locations as of July 31, 2016, and provides logistical fuel transportation to MAPCO and third parties with approximately 50 tractors and trailers. COPEC is expected to retain MAPCO’s current retail team to provide for a seamless entrance into the U.S. convenience store market. The deal comes a week after Canadian Alimentation Couche-Tard Inc. (TSX: ATD.A ATD.B), one of the world’s largest company-owned convenience store operators, agreed to acquire San Antonio, Texas-based CST Brands Inc. (NYSE: CST) for $4.4 billion. CST operates over 2,000 locations throughout the Southwestern United States with an important presence in Texas, Georgia, the U.S. Southeast Region, New York and Eastern Canada. CST also controls the general partner of CrossAmerica Partners (NYSE: CAPL), a gas distributor to more than 1,100 locations in the United States. COPEC is one of the largest companies in Chile, operating in fuel and lubricants distribution and convenience stores. The company has an existing presence in the convenience stores market, with the largest convenience store network in Chile and 53% of the Chilean gasoline market share, with 626 company and dealer operated service stations, 82 Pronto-branded convenience stores and 220 Punto-branded convenience stores. COPEC is an industry innovator with Pagoclick (mobile pay), Zervo (self-serve fueling dispenser) and leading convenience store developer with multiple formats for urban, suburban and highway locations. In addition, COPEC has a 58.9% ownership stake in Bogota, Colombia-based Organizacion Terpel SA (BVC: TERPEL), which accounts for approximately 45% of Colombia’s fuel market share. Terpel has 1,949 Terpel-branded gas stations in Colombia and 233 stores in Panama, Ecuador, Peru and Mexico under store brands Altoque and Deuna selling Terpel-branded fuel. COPEC was founded in 1934 and is headquartered in Santiago, Chile. Through its subsidiary Celulosa Arauco, it has a commercial presence in over 80 countries, with production facilities in Chile, Argentina, Brazil, Canada, the United States and Uruguay. AntarChile SA (SNSE: ANTARCHILE) has a 60% controlling stake in COPEC. “The acquisition of MAPCO represents an important step for COPEC’s entry into the U.S. convenience store market, which has been identified as a key strategic growth opportunity,” said COPEC CEO Lorenzo Gamuri. “MAPCO’s assets are located in a geographic zone with interesting demographic attributes and with the size for a proper competitive operation in the US market.” “After buying into the control of Organización Terpel in 2010, this is the second significant step to transform Copec into a broader company in the fuel retail and convenience store market,” added Gamuri. “The sale of MAPCO to COPEC allows Delek to simultaneously unlock the value of these assets and gain a continuing competitive partner in retail fuel sales,” said Delek chairman, president, and chief executive Uzi Yemin. Delek’s exclusive financial advisor was RBC Capital Markets LLC. COPEC’s financial advisor was Raymond James & Associates Inc. and legal advisor was Simpson Thacher & Bartlett LLP. Delek US is a diversified downstream energy company with assets in petroleum refining, logistics and convenience store retailing. The refining segment consists of refineries operated in Tyler, Texas, and El Dorado, Arkansas, with a combined nameplate production capacity of 155,000 barrels per day. Delek US also owns 62 percent of Delek Logistics Partners LP (NYSE: DKL), focused on midstream energy infrastructure assets. Delek US also owns 48 percent of Alon USA Energy Inc. (NYSE: ALJ). Delek US is headquartered in Brentwood, Tennessee and employs more than 4,000 people across the eight states. Delek Group owns a stake of nearly 8 percent in Delek US, which has a market capitalization of $1.08 billion. The Delek Group (TASE: DLEKG) (OTCQX: DGRLY), controlled by Israeli billionaire Isaac Tshuva, is a dominant integrated energy company in Israel, and a pioneering leader of the natural gas exploration and production activities that are transforming the Eastern Mediterranean’s Levant Basin into one of the energy industry’s most promising emerging regions. Having discovered Tamar and Leviathan, two of the world’s largest natural gas finds since 2000, Delek and its partners are now developing a balanced, world-class portfolio of exploration, development and production assets with total gross natural gas resources discovered since 2009 of approximately 37 TCF. In addition, Delek Group has a number of assets in downstream energy, water desalination, and the finance sector. The company has a market capitalization of $2.37 billion.]]>