DALLAS, Oct. 10, 2011 /PRNewswire/ -- HollyFrontier Corporation (NYSE: HFC) and Holly Energy Partners, L.P. (NYSE: HEP) today announced that their respective Boards of Directors have approved, subject to the execution of definitive agreements and other customary closing conditions, the acquisition by Holly Energy Partners, L.P. (Holly Energy) from HollyFrontier Corporation (HollyFrontier) of certain pipeline, tankage, loading rack and crude receiving assets located at HollyFrontier's El Dorado, Kansas and Cheyenne, Wyoming refineries for $340 million.
The purchase price of $340 million is expected to be paid in promissory notes with an aggregate original principal amount of $150 million and approximately 3.8 million Holly Energy common units valued at $190 million based upon the volume-weighted average price for the 10 trading days which ended October 7, 2011.
In connection with the closing of the proposed transaction, HollyFrontier and Holly Energy expect to enter into 15-year throughput agreements containing minimum annual revenue commitments from HollyFrontier. Holly Energy expects that this acquisition will result in an estimated $47 million of incremental annual revenue and that the transaction will be accretive to unit holders.
Both HollyFrontier and Holly Energy expect the proposed transaction will close in November, after the anticipated record date for third quarter 2011 distributions for Holly Energy common units.These assets being acquired consist of:
- the following assets located at HollyFrontier's El Dorado refinery:
- approximately 3.7 million barrels of hydrocarbon storage tanks;
- one refined products truck loading rack and one propane truck loading rack; and
- related refined product pipeline connections;
- the following assets located at HollyFrontier's Cheyenne refinery:
- approximately 1.8 million barrels of hydrocarbon storage tanks;
- one refined products truck loading rack, two propane loading spots, and three crude oil LACTs; and
- a crude receiving pipeline.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV