Delek Logistics Partners LP, a subsidiary of Delek Group Ltd. (TASE: DLEKG), controlled by Yitzhak Tshuva, will seek to raise a gross $152-168 million in an offering of eight million shares at $19-21 per share on the New York Stock Exchange. The company value for the offering is $456-504 million, after money, with the midpoint market value of $480 million.
Delek Logistics, a unit of unit Delek Group subsidiary Delek US Holdings Inc. (NYSE:DK), was established earlier this year to own Delek US's crude oil and refined products logistics assets in US southeast. The company had $888 million in sales in the twelve months through June 2012.
Delek Logistics will use the proceeds as follows: $57.8 million will be distributed as a dividend, $50.9 million will be used to repay bank debts, and $35 million will be invested in working capital.
The underwriters have an over-allotment offer to buy up to an additional 1.2 million shares, which if exercised in full will increase the offering by a gross $24 million at the midpoint. If the underwriters do not exercise their over-allotment option, Delek Logistics will allot these shares to Delek US at no cost.
After the offering, Delek Group will indirectly own 67.3% of Delek Logistics.
Delek Logistics will be traded under the ticker "DKL".
Delek Logistics is being floated as an "emerging growth company" under the Jumpstart Our Business Startups Act (JOBS Act) of April 2012. An “emerging growth company” is defined in the Securities Act and the Exchange Act as an issuer with “total annual gross revenues” of less than $1 billion during its most recently completed fiscal year. The company will receive regulatory breaks for an IPO, including back stating financial results for only two years.
Published by Globes [online], Israel business news - www.globes-online.com - on October 28, 2012
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