Arc Logistics to be acquired by Zenith for $16.50 per unit in cash

Arc Logistics (ARCX), Lightfoot Capital Partners GP, and Lightfoot Capital Partners, LP announced that they have entered into a Purchase Agreement and Plan of Merger with Zenith Energy U.S., L.P., a portfolio company of Warburg Pincus, pursuant to which Zenith will acquire Arc Logistics GP LLC, the general partner of the Partnership, and all of the outstanding common units in Arc Logistics.

Under the terms of the Merger Agreement, all Arc Logistics common unitholders, other than Lightfoot, will receive $16.50 per common unit in cash for each common unit they own, which represents a premium of approximately 15% to the Partnership’s common unit price as of August 28, 2017.

LCP LP will receive $14.50 per common unit in cash for the approximately 5.2 million common units held by it, and LCP GP will receive $94.5 million for 100% of the membership interests in Arc GP.

In connection with the Proposed Transaction, the board of Arc GP formed a conflicts committee composed of independent directors of the Arc board to review, evaluate and negotiate the Merger.

The Conflicts Committee approved the Merger Agreement and the Merger, determined that the Merger Agreement and the Merger are fair and reasonable to and in the best interests of the Partnership and the holders of common units and recommended that the Arc board and holders of common units approve the Merger Agreement and the Merger.

Following recommendation and approval from the Conflicts Committee, the Arc board unanimously approved the Merger Agreement and the Merger and is recommending that all Arc Logistics common unitholders vote in favor of the Merger Agreement and the Merger.

The completion of the Proposed Transaction is subject to a number of closing conditions, including approval by a majority of the outstanding Arc Logistics common unitholders and the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

Lightfoot, the owner of Arc GP and approximately 26.8% of the outstanding common units, has executed an agreement to vote in support of the Proposed Transaction.

Additionally, the Proposed Transaction is subject to the closing of the purchase by Zenith and Lightfoot from EFS Midstream Holdings LLC of certain of the interests in Arc Terminals Joliet Holdings LLC, which indirectly owns among other things a crude oil unloading facility and a 4-mile crude oil pipeline in Joliet, Illinois, and the closing of the purchase by Zenith of a 5.5% interest in Gulf LNG Holdings Group, LLC, which owns a liquefied natural gas regasification and storage facility in Pascagoula, Mississippi, from Lightfoot. T

he Proposed Transaction is not subject to a financing condition and closing is targeted at the end of the fourth quarter of 2017 or early in the first quarter of 2018.

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