Kirby Corporation Completes Acquisition of
K-Sea Transportation Partners
There is one less publicly traded partnership on the market following the completion on July 1, 2011 of the acquisition of K-Sea Transportation Partners (NYSE:KSP) by Kirby Corporation (NYSE:KEX). As a result of the transaction, K-Sea is now a wholly-owned subsidiary of Kirby and its units have been taken off the market. K-Sea's current management will continue to run its operations following the merger.
K-Sea's unitholders approved the merger in a special meeting held at its corporate headquarters on July 1. The transaction was valued at approximately $604 million before transaction fees, including $228 million in cash paid to K-Sea's unitholders and general partner, $263 million to retire K-Sea's outstanding debt, and $113 million through the issuance of 1.9 million shares of Kirby common stock. As part of the merger agreement, K-Sea's unitholders were given the right to elect to receive either all cash or a combination of cash and Kirby common stock in exchange for their units.
K-Sea announced that it had reached a definitive agreement to merge with Kirby Corporation on March 13, 2011 (click here to see the story). Kirby is a Houston, Texas operator of inland tank barges and towing vessels which transports petrochemicals, black oil products, refined petroleum products and agricultural chemicals throughout the United States inland waterway system. K-Sea is one of the largest coastwise tank barge operators in the United States, with a fleet comprised of 58 tank barges with a capacity of 3.8 million barrels and 63 tugboats. It provides refined petroleum products transportation, distribution and logistics services in the domestic marine transportation market and is one of six MLPs currently engaged in shipping.
Two other shipping MLPs, OSG America and U.S. Shipping Partners, left the market in 2009 after OSG America was repurchased by its parent and U.S. Shipping Partners converted to corporate form as a result of Chapter 11 proceedings. Shipping MLPs still on the market include Capital Product Partners L.P. (CPLP); Golar LNG Partners LP (GMLP), which IPO'd in April; Navios Maritime Partners L. P. (NMM); Teekay LNG Partners, L. P. (TGP); and Teekay Offshore Partners, L.P. (TOO). In addition Martin Midstream Partners L.P. (MMLP) provides marine transportation on inland U.S. waterways.