On Monday the Houston-based oil and gas pipeline operator announced it had received a proposal from CEO Richard Kinder and a group of investors proposing to purchase all of the company's outstanding stock for $100 a share. The offer represents an 18.5% premium to Kinder Morgan¿s Friday closing price of $84.41.
The company has about 133.6 million shares outstanding, meaning it will cost about $13.4 billion to acquire all the shares at the proposed price.
Kinder, other senior managers, company co-founder Bill Morgan and directors Fayez Sarofim and Mike Morgan would contribute $2.8 billion of their existing shares to the new company.
The transaction would also be financed through about $4.5 billion of equity provided by Goldman Sachs Capital Partners,
American International Group
, The Carlyle Group and Riverstone Holdings.
The new company would also take on about $14.5 billion of debt, giving the deal a total price of about $21.8 billion. That would make it the largest private-equity deal since Kohlberg Kravis & Roberts bought RJR Nabisco in 1989, according to
The Wall Street Journal
. It would also be the single largest management buyout in U.S. history, the newspaper said.