Senior Managers Offer To Buy Kinder Morgan

Pipeline operator Kinder Morgan Inc., has announced that the chairman and CEO has teamed up with senior managers and outside investors to purchase the company for about $13.4 billion and take it private. A letter received by the Houston-based company’s board of directors from Richard D. Kinder CEO, offered to pay $100 a share, and 18.5 percent premium above the closing price on Friday of $84.41.

The deal also includes the assumption of more than $8 billion in debt, bringing its total value to almost $22 billion. Kinder Morgan’s board of directors has formed a special committee of independent directors to consider the proposal.

According to Kinder, the acquisition would be structured as a merger between the company and the group of investors that would include Bill Morgan, board members Fayez Sarofim and Mike Morgan, Goldman Sachs Capital Partners, AIG Global Asset Management Holdings Corp., The Carlyle Group and Riverstone Holdings LLC.

The reinvestment of 100 percent of Kinder’s equity stake in the company, combined with the investment from other senior managers and board members would amount to roughly $2.8 billion, based on the proposed transaction price. The outside investors would provide $4.5 billion in equity, and the remainder of the transaction would be financed with debt.