WNR - Hearing Set for Giant, Western Deal
Tuesday April 17, 6:39 pm ET
Hearing Slated on Proposed Deal Between Giant, Western Refining
EL PASO, Texas (AP) -- A hearing is set May 7 in U.S. District Court in New Mexico over Western Refining Inc.'s proposed acquisition of Giant Industries Inc.
The two companies asked for the hearing after a request by the Federal Trade Commission earlier this month for a temporary restraining order and preliminary injunction to halt Western Refining's $1.13 billion purchase of rival energy company Giant Industries.
The hearing is set for 9 a.m. before U.S. District Judge James Browning of Albuquerque.
The FTC contends the buyout would lead to reduced competition for the bulk supply of light petroleum products, including motor gasoline, to northern New Mexico, where the two companies are direct competitors.
"Western's acquisition of Giant would eliminate this competition, leading to higher prices for consumers of these important energy products," Jeffrey Schmidt, director of the FTC's Bureau of Competition, said last week.
Western agreed to buy Giant last August for $83 per share in a deal worth $1.5 billion including $280 million in assumed debt. It lowered its bid to $77 per share in November because of Giant's disappointing financial performance after fires temporarily disabled two refineries.
Giant Industries shareholders voted to approve the transaction on Feb. 27, but the deal is subject to the pending FTC litigation.
Western Refining, with headquarters in El Paso, is an independent crude oil refiner and marketer of refined products. It operates primarily in the Southwest.
Giant, with headquarters in Scottsdale, Ariz., is a refiner and marketer of petroleum products. It owns two New Mexico crude oil refineries and one in Virginia; a crude oil gathering pipeline system based in Farmington, N.M.; finished products distribution terminals in Albuquerque, N.M., and Flagstaff, Ariz.; a fleet of crude oil and finished product truck transports and a chain of retail service station and convenience stores in New Mexico, Colorado and Arizona.
