Mergers & Acquisitions Marketplace, March 2012

Eastman Chemical to acquire Solutia for $4.7 billion

KINGSPORT, Tenn. And ST. LOUIS — Eastman Chemical Co. And Solutia Inc. have entered into a definitive agreement, under which Eastman Chemical will acquire Solutia, a global leader in performance materials and specialty chemicals. Based on closing prices, Solutia shareholders will receive cash and stock valued at $27.65 per Solutia common share, representing a premium of 42 percent and a total transaction value of approximately $4.7 billion.

“The acquisition of Solutia is a significant step in our growth strategy and one I am confident will strengthen Eastman as a top-tier specialty chemical company with strong, stable margins,” said Jim Rogers, chairman and CEO of Eastman Chemical.

“This transaction provides Solutia’s shareholders with immediate value and an attractive premium, as well as the opportunity to benefit from the future prospects of a leading global chemicals producer with the financial strength, a diversified mix of premium products and the geographic footprint to capitalize on long-term growth opportunities,” said Jeffry N. Quinn, chairman, president and CEO of Solutia.

For more information, visit www.Eastman.com or call (423) 229-2000.

Apache acquires Cordillera Energy Partners III for $2.85 billion

HOUSTON — Apache Corp. has agreed to acquire Cordillera Energy Partners III LLC, a privately held company with substantial operations that include approximately 254,000 net acres in the prolific Granite Wash, Tonkawa, Cleveland and Marmaton plays in western Oklahoma and the Texas Panhandle, for $2.85 billion.

In addition to estimated proved reserves of 71.5 million barrels of oil equivalent and current net production of 18,000 barrels of oil equivalent per day, Cordillera has assembled a leading acreage position with significant resource potential, including 14,000 potential drilling locations in liquids-rich Anadarko Basin plays. The acquired acreage is characterized by high working interest and operatorship, with approximately half held by production.

“This is an important growth step for Apache — a unique bolt-on opportunity that more than doubles Apache’s acreage in a highly liquids-rich fairway in the Anadarko Basin,” said G. Steven Farris, Apache chairman and CEO.

For more information, visit www.Apachecorp.com or call (713) 296-6000.

SandRidge to acquire Dynamic Offshore for nearly $1.3 billion

OKLAHOMA CITY — SandRidge Energy Inc. has entered into an agreement to acquire Dynamic Offshore Resources LLC for aggregate consideration of nearly $1.3 billion, consisting of approximately $680 million in cash and approximately 74 million shares of SandRidge common stock valued at $8.02 per share.

Dynamic Offshore Resources operates primarily in water depths of less than 300 feet and its current production is approximately 25 million barrels of oil equivalent. Dynamic’s year-end 2011 proved reserves are 62.5 million barrels of oil equivalent and are valued at approximately $1.9 billion. Of these reserves, 80 percent of the value and quantity are proved developed. Approximately 50 percent of Dynamic’s current production and proved reserves consist of oil. The acquisition will be accretive to SandRidge’s earnings and cash flow per share as well as improve its leverage metrics.

The transaction is expected to close during the second quarter of 2012, subject to customary closing conditions.

For more information, visit www.Sandridgeenergy.com or call (405) 429-5500.

AltaGas to acquire Semco Holding for more than $1.1 billion

PORT HURON, Mich. — AltaGas Ltd.Has entered into a definitive agreement with Continental Energy Systems LLC to acquire Semco Holding Corp. for more than $1.1 billion, including approximately $355 million in assumed debt. SEMCO is the sole shareholder of SEMCO ENERGY Inc., a privately held regulated public utility company.

“AltaGas’ vision is to be a leading North American infrastructure company,” said David Cornhill, chairman and CEO of AltaGas. “This acquisition continues the successful execution of our growth strategy. These assets come with strong management teams and employees who have a strong track record of delivering safe and reliable service to their customers and have excellent relationships with the communities in which they operate.We look forward to welcoming the SEMCO management teams and employees to AltaGas. We have a long history of operating natural gas utilities, and we will continue to deliver safe and reliable service to our customers. This acquisition establishes a significant foothold in the United States.”

The acquisition is subject to regulatory approval, including approvals from the Michigan Public Service Commission and the Regulatory Commission of Alaska.
The acquisition is expected to close in the third quarter of 2012.

For more information, visit www.Continentalllc.com or call (248) 458-6169.

Calumet Lubricants Co. LP acquires TruSouth Oil LLC

INDIANAPOLIS — Calumet Specialty Products Partners LP’s wholly owned subsidiary, Calumet Lubricants Co. LP, has acquired all of the outstanding membership interests of TruSouth Oil LLC, a specialty petroleum packaging and distribution company located in Shreveport, La., for an undisclosed value.

TruSouth Oil, formed in 2006, manufactures and markets a variety of specialty products including motor oils, gear oils, engine oils, automotive fluids and specialty engineered fuel and oil mix products. TruSouth Oil’s assets include an 85,000-square-foot production and warehouse facility with state-of-the-art blending and packaging equipment, and bulk tank storage capacity of approximately 1. 5 million gallons.

“All of the employees at TruSouth Oil have done an excellent job in growing this business over the past five years through development and production of high-quality specialty products,” said Bill Anderson, Calumet’s vice president of sales and marketing. “We are pleased to complete this acquisition and look forward to continuing TruSouth Oil’s growth in its products and brands as well as further integration with Calumet’s specialty products portfolio.”

For more information, visit www.Calumetspecialty.com or call (800) 437-3188.

USA Tank acquires All State Tank Manufacturing

GOODMAN, Mo. — USA Tank has acquired All State Tank Manufacturing LLC located in Grove, Okla. All State Tank is a leading manufacturer of epoxycoated carbon steel storage tanks.

The acquisition combines two organizations that are leaders in the tank storage industry to create a one-stop shop for superior engineering, project management, manufacturing, procurement and construction of a variety of storage systems.The Grove plant will add 50,000 square feet of manufacturing space.

“Having the ability to now manufacture our own epoxy-coated carbon steel tank will allow us to provide a far superior product with improved customer service and timelines in a state-of-theart manufacturing facility,” said USA Tank President Chris Slinkard. “We have always provided first-class sales, customer service, project management and construction. The purchase of All State Tank will allow us to manufacture tanks with exceptional quality and value.”

For more information, visit www.Usatank.com or call (866) 700-2500.

Superior Energy Services acquires Complete Production Services

HOUSTON — Superior Energy Services Inc. has closed its acquisition of Complete Production Services Inc. Superior Energy Services issued approximately 74.8 million shares related to this transaction and paid approximately $554 million in cash. Former stockholders of Complete Production Services hold approximately 48 percent of the combined company’s outstanding common stock.

David Dunlap, president and CEO of Superior Energy Services, said, “I want to personally welcome the Complete Production Services employees to our team.I am excited about the opportunity to work with an additional dedicated and focused work force of approximately 7,400 strong, and I welcome the energy, efforts and ideas of all employees as we build upon our collective strengths and opportunities brought about by this combination.

“This transaction provides us more access to U.S. land markets sooner than we could have accomplished on a standalone basis, while providing important completion and intervention services that we did not offer our customers. The combination will also assist us in accelerating our international expansion efforts as excess cash flows from North America can be deployed abroad to meet our growing international opportunity set.”

For more information, visit www.Superiorenergy.com or call (281) 999-0047.

Constellation Energy acquires ONEOK Energy Marketing Co.

BALTIMORE — Constellation Energy, a leading competitive energy provider, has closed the acquisition of ONEOK Energy Marketing Co. (OEMC), a Tulsa, Okla., retail natural gas marketing company with approximately 26,000 customers.

The purchase of OEMC, a subsidiary of ONEOK Inc., for $22.5 million, plus working capital, expands Constellation Energy’s business and residential customer base in Kansas, Oklahoma, Missouri, Texas, Nebraska, Wyoming and Illinois, and also expands Constellation Energy’s customer footprint to 46 states.

“We’re pleased to bring OEMC into the Constellation Energy family and broaden the natural gas services we can offer in the mid-continent region,” said Mark Huston, head of Constellation Energy’s retail business. “We look forward to delivering the customer experience and innovative solutions that are the hallmark of Constellation’s growing retail business.”

For more information, visit www.Constellation.com or call (410) 470-2800.

BIC Magazine
Author: BIC Magazine, bicnews@bicalliance.com

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