After purchasing part of Alon USA last year, Delek US Holdings is looking to take its acquisition of the company’s assets further.
Delek, on Friday, Oct. 14, delivered non-binding letter to special committee of the board of Alon USA, in which it proposed a potential business transaction that would combine Delek and Alon USA Energy, according to a report by Reuters.
Brentwood, Tenn.-based Delek US Holdings board of directors has authorized its management to engage in negotiations on the proposal, which includes buying each outstanding share of Alon, which Delek does not already own, at fixed exchange ratio of 0.44 Delek shares for each outstanding Alon share.
Last year, Delek paid $565 million for about 48% of Alon USA, according to the Nashville Post.
As noted in the letter, Delek will not move forward with proposed transaction unless approved by special committee of board of Alon USA, Reuters reported.
Given the all-stock nature of the transaction, the proposal would not be subject to any financing contingency.