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US chemicals firm TPC to go private in $850mn deal

08.27.2012  | 

First Reserve director Neil Wizel said the investment firm plans to help TPC Group expand its core business to capitalize on shale plays in North America and the resulting increase in supply of natural gas and natural gas liquids. The deal is expected to close in the fourth quarter.

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By TESS STYNES

Chemical maker TPC Group agreed to be taken private by investment firms First Reserve Corp. and SK Capital Partners in a deal valued at about $627 million.

Including net debt, the deal for the chemical company is valued at about $850 million. It is expected to close in the fourth quarter.

TPC shareholders will receive $40/share, as anticipated by media reports last month. Shares closed Friday at $39.59 and were halted in recent premarket trading.

Through Friday's close, the stock is up roughly 20% since reports of a potential deal emerged in late July.

First Reserve director Neil Wizel said the investment firm plans to help TPC Group expand its core business to capitalize on shale plays in North America and the resulting increase in supply of natural gas and natural gas liquids.

“We are very pleased to enter into this agreement with First Reserve and SK Capital, and we believe this transaction is in the best interests of TPC Group's stockholders,” said TPG chief executive Michael T. McDonnell.

“We are committed to the execution of our near- and long-term strategic initiatives and remain on schedule with our projects.”

TPC Group chairman Michael E. Ducey said TPC late last year formed a special committee to review the company's strategic and financial alternatives.

TPC Group was formerly known as Texas Petrochemicals.


Dow Jones Newswires



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