JERUSALEM, July 16 (Reuters) - Energy company Delek U.S. Holdings (DK.N) said on Monday it had agreed to buy a minority stake of 28.3 percent in U.S.-based Lion Oil Co. for $65.4 million in cash.
Delek U.S., a subsidiary of Israeli conglomerate The Delek Group DELKG.TA, said it will also sell 1.92 million shares of its common stock to TransMontaigne Inc., a wholly owned subsidiary of Morgan Stanley Capital Group.
The transactions are expected to close in the third quarter and are subject to regulatory and other approvals.
Privately held Lion Oil owns and operates a 75,000 barrel per day, high conversion crude oil refinery in Arkansas, as well as three crude oil pipelines and two refined petroleum products terminals in Tennessee that supply some of Delek’s 188 convenience stores in Tennessee.
Delek focuses on petroleum refining and the sale of refined products. It operates a high conversion refinery with a capacity of 60,000 barrels a day in Texas.
“The assets of Lion Oil fit well with our operations, and we expect this investment to immediately enhance the earnings of Delek,” Uzi Yemin, president and chief executive of Delek U.S., said in a statement.
“This agreement establishes a relationship between Delek and Morgan Stanley Capital Group Inc. and a Morgan Stanley Capital Group Inc. affiliate and we look forward to future opportunities to work with them,” he added.