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BGH GP Holdings to take Buckeye GP private for $17 per common unit
By Lisa Kerner
Charlotte, N.C., Oct. 22 - BGH GP Holdings, LLC said it plans, within the next two weeks, to make a tender offer for all of the outstanding common units of Buckeye GP Holdings, LP it does not already own in a bid to take Buckeye private.
Buckeye common unitholders would receive $17 per unit in cash for a total consideration of approximately $180 million, according to schedule 13D filed with the Securities and Exchange Commission.
The offer price is an approximately 19% premium above the closing price of Buckeye's common units on Oct. 21.
Currently, BGH GP owns 62% of the outstanding common units and 100% of MainLine Management LLC, the general partner that controls Buckeye.
BGH GP said the offer is not conditioned on obtaining financing.
However, the offer is conditioned on the tender of sufficient common units to give BGH GP ownership of more than 90% of the outstanding common units.
MainLine's board of directors has formed a special committee of three independent directors to review the proposal from BGH GP, Buckeye said.
The committee and its advisers will determine the appropriate response to the proposal, according to a Buckeye news release.
Once the offer is completed, BGH GP would exercise its limited call right under its partnership agreement to acquire any remaining common units at the same $17-per-unit price.
Buckeye would then become a privately held, wholly owned subsidiary of BGH GP, and its common units would cease to trade on the New York Stock Exchange.
Affiliates of ArcLight Capital Partners, LLC and Kelso & Co. primarily own BGH GP, a limited liability company.
Buckeye, through its general partner interests in Buckeye Partners, LP, transports and stores refined petroleum products for integrated oil companies, refined products marketing companies and users of petroleum products. The company is based in Breinigsville, Pa.
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