July 20, 2009 / 2:15 PM / 10 years ago

UPDATE 2-Catsimatidis to support SemGroup reorganization

* SemGroup, Catsimatidis Group agree to end litigation

* United Refining to purchase a SemGroup unit’s venture

* 4 to resign from general partner’s management committee (Rewrites first paragraph; adds details about the Catsimatidis group)

NEW YORK, July 20 (Reuters) - SemGroup LP [SEMGP.UL] said on Monday that it had reached an agreement with a group led by John Catsimatidis to support the oil and gas services company’s bankruptcy reorganization plan.

SemGroup also said it had agreed to sell its subsidiary’s interest in an asphalt marketing joint venture to United Refining Co [RAPPLU.UL].

John Catsimatidis, who is the head of United Refining, and three other members of the management committee of SemGroup’s general partner will withdraw their earlier objection to the reorganization plan. Catsimatidis has been using the management committee to put forward his own plan of reorganization.

In addition, SemGroup said United Refining plans to purchase its interest in the joint venture for a one-time payment of $3.9 million.

The agreements were announced as a hearing was set to begin in U.S. Bankruptcy Court in Delaware on SemGroup’s disclosure statement, which must be approved to clear the way for it to emerge from bankruptcy.

As part of the agreement, Catsimatidis and SemGroup will end litigation between the two in Oklahoma and Delaware.

Catsimatidis, J. Nelson Happy, James Hansel and Martin Bring will resign from the general partner’s management committee when the Delaware bankruptcy judge overseeing the case approves their agreement.

SemGroup, which sells, processes, transports and stores energy for users of crude oil, natural gas and refined products, was the 14th-largest privately held U.S. company when it filed for bankruptcy protection in July 2008 after sustaining $3.2 billion in losses due to bad bets on oil prices.

The case is In re: SemCrude LP, U.S. Bankruptcy Court, District of Delaware, No. 08-11525. (Reporting by Chelsea Emery and Tom Hals; Editing by John Wallace and Lisa Von Ahn)

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