TPC Group, a specialty chemical maker, will be taken private in a deal valued at $850 million.
The private equity firms, First Reserve Corporation and SK Capital Partners, have agreed to pay $40 a share in cash for TPC. The deal, which also includes debt, represents a 20 percent premium to TPC's closing price on Friday.
TPC, which produces butadiene, has been struggling amid weak demand. With butadiene prices dropping by 26 percent in the latest quarter, TPC notched earnings of $3 million, down from $34 million a year ago.
Late last year, the company started considering “strategic and financial alternatives.†The deal on Monday “recognizes the value of TPC Group's business and prospects and provides our stockholders with an immediate cash premium for their valued investment,†Michael E. Ducey, Non-Executive Chairman of the TPC Group Board of Directors said in a statement.
Perella Weinberg Partners, a financial firm, and Baker Botts, a law fi rm, are advising TPC. Jefferies & Company and Simpson Thacher & Bartlett are working with First Reserve and SK Capital. Skadden, Arps, Slate, Meagher & Flom is advising the special committee to the TPC board.
