Mississippi firm makes $147 million buyout offer of Tulsa’s Blueknight Energy

Tulsa-based Blueknight Energy Partners, L.P. announced it has received a $147 million buyout offer from Ergon, Inc. based in Jackson, Mississippi.

Ergon, Inc. is a crude oil processor, transporter and marketer of refined products including asphalt. It also manufactures road maintenance products and equipment and predominant owners are members of the Lampton family including William W. Lampton, Robert H. Lampton, Leslie B. Lampton III and Lee C. Lampton.

A Schedule 13D filing by Ergon with the U.S. Securities Exchange Commission disclosed the non-binding proposal to the Board of Directors of Blueknight Energy Partners, G.P., LLC, the general partner of the partnership.

Under the offer, Ergon would acquire all the outstanding common units and Series A Preferred Units of the partnership not already owned by Ergon. The cash offer is a price of $1.35 per common unit and $5.67 per Series A Preferred unit.

 

The proposed transaction is subject to several contingencies, including the approval of the Conflicts Committee of the GP Board, the approval by the Partnership’s unitholders, and the satisfaction of any conditions to the consummation of a transaction set forth in any definitive agreement concerning the transaction. There can be no assurance that definitive documentation will be executed or that any transaction will materialize on the terms described above or at all.

 

 

Ergon’s primary business activity is to operate as a sophisticated crude oil processor, transporter and marketer of refined products. Ergon functions as a producer and marketer of specialty asphalt products, as well as an oil and gas explorer and real estate developer. In addition, Ergon manufactures state-of-the-art road maintenance products and equipment. Members of the Lampton family, including William W. Lampton, Robert H.

 

4


Lampton, Leslie B. Lampton, III and Lee C. Lampton, are the predominant owners, directly or through trusts, of the voting equity of Ergon. The members of the Lampton family disclaim beneficial ownership of the securities of the Issuer.

 

ii.

EA&E’s primary business activity is to manufacture and market asphalt products.

The Reporting Persons estimate that approximately $146.6 million in cash will be required to acquire all of the outstanding Common Units and Series A Preferred Units not already owned by Ergon or its affiliates pursuant to the proposed transaction described in Item 4 below. Ergon intends to finance the proposed transaction from existing cash and proceeds from its existing credit facilities. The proposed transaction is not expected to be subject to any financing condition.

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