Hedge Funds Increase Bid for Martin Midstream Takeover
(Reuters) — Hedge funds Nut Tree Capital Management and Caspian Capital have made a sweetened bid to acquire fuels storage and transporter Martin Midstream Partners, according to a letter seen by Reuters on Monday.
The new offer would give unitholders of Martin Midstream $4.50 per unit in cash and value the company at nearly $176 million, up from the $4 per unit bid from the hedge funds on July 11.
The offer is the latest attempt from the hedge funds to thwart a rival takeover bid from Martin Midstream's largest shareholder, Martin Resource Management Corporation (MRMC), which has offered $3.05 per unit in cash to acquire all common units it did not already own.
MRMC is headed by Ruben S. Martin III, whose father in 1951 set up the business to which MRMC and Martin Midstream trace their roots.
In the letter to the board committee of Martin Midstream set up to evaluate MRMC's proposal, Nut Tree and Caspian indicated they were open to submitting an even higher bid to buy Martin Midstream's common units, if they are granted access to the company's books and are allowed to enter into a confidentiality pact that allows the exchange of commercially sensitive information.
Kilgore, Texas-based Martin Midstream's common units were trading at $3.42 on Monday, giving the company a market value of roughly $135 million. Including debt, the company is valued at about $518 million, according to LSEG data.
Martin Midstream and MRMC did not immediately respond to requests for comment.
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