Houston – Kinder Morgan Inc. said Monday its board of directors approved a $15 billion buyout plan from the pipeline operator’s management to take the company private at a higher per-share price than announced three months ago.
The company’s shares soared to a 52-week high.
Under terms of the deal, a management-led investment group would pay Kinder Morgan shareholders $107.50 for each share of common stock – a 7.5 percent jump over the original buyout price of $100 per share, the Houston-based company said.
Kinder Morgan shares rose as high as $104.50 a share – surpassing the 52-week range of $81 to $103.75 – before closing at $104.27, up $2.57, or 2.5 percent.
The new offer from Kinder Morgan chairman and chief executive Richard Kinder and other senior managers and outside investors represents a 5.7 percent premium over the company’s closing stock price Friday and a 27 percent premium over the closing price May 26, the last trading day before the group made its initial proposal.
The deal remains worth $22 billion, including $7 billion in assumed debt.
The company said Monday that directors unanimously voted to accept the agreement and that the deal, pending shareholder and regulatory approval, is expected to close early next year.
Robert Lane, an analyst with Sanders Morris Harris, said the new price is closer to the true value of the company, which he said could reach $150 to $160 per share. He said last month he expected the actual buyout price to range from $105 to $110 per share.
Lane added it was unlikely shareholders would reject the plan, particularly since another bidder hasn’t come forward and that any other bidder wouldn’t include Kinder.
“He is the marquee name; he’s the visionary. Everyone else is an operator or a finance guy,” Lane said of the investor group.
