Energy Services

There is a fevered battle going on to prevent Marathon Petroleum from consummating a deal to buy MarkWest Energy. Yesterday we told you that MarkWest was touting two more proxy advisory firms, in addition to a previously named advisory firm, have endorsed the deal (see War of Words Continues: 2 More Proxy Cos Endorse MarkWest Sale). We also told you that one of MarkWest’s two co-founders and a former CEO of the company, John Fox, is dead set against the deal (see Former MarkWest Energy CEO Urges Vote Against Marathon Buyout). The other MarkWest co-founder, Brian O’Neill, has now come out against the sale as well…
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The public relations battle between the current management and board of MarkWest Energy, who stand to personally benefit from a sale of the company to Marathon Petroleum (via Golden Parachutes), continues. On Friday MarkWest issued another press release (seems they’re coming along almost daily now) to encourage people to vote “yes” with their units. MarkWest is claiming two more proxy advisory firms have endorsed the deal–Glass Lewis and Egan-Jones. It was just last week that MarkWest’s former CEO issued another press release of his own telling the world this is a bad deal for common unitholders and should be voted down (see War of Words: Battle to Sell MarkWest Energy to Marathon Heats Up). MarkWest, in their latest press release, re-issued their plea for anyone with even a couple of units (think “shares of stock) laying in a drawer somewhere to vote–every vote counts in this battle…
Read More “War of Words Continues: 2 More Proxy Cos Endorse MarkWest Sale”

The war of words continues in what increasingly appears to be a losing battle for MarkWest Energy to convince enough shareholders to vote in favor of a proposed sale to Marathon Petroleum. We told you two weeks ago that John Fox, former CEO of MarkWest Energy, came out strongly against the deal (see Former MarkWest Energy CEO Urges Vote Against Marathon Buyout). Since that time Marathon has increased the amount of cash they’re willing to offer–twice–from an original $675 million to now $1.28 billion (see Marathon Ups Cash Offer for MarkWest 2nd Time – Deal in Trouble?). The original deal was worth around $20 billion when you include unit swaps and other considerations. Now the deal is worth around $15 billion due to unit prices plunging over the past few months. Two days ago MarkWest promoted the news that Institutional Shareholder Services (ISS), an “independent” proxy advisory firm, was recommending unitholders vote in favor of the deal. Yesterday John Fox issued his own rebuttal to ISS and continues to say this is “fundamentally a bad deal” and that ISS’ own report supports his arguments against the deal. It’s getting hot in the kitchen!…
Read More “War of Words: Battle to Sell MarkWest Energy to Marathon Heats Up”

For a second time in as many weeks, Marathon Petroleum has increased the amount of cash it’s willing to pay as part of the deal to purchase Marcellus/Utica midstream giant MarkWest Energy. Last week Marathon upped the cash portion of the deal from $675 million to $1.075 billion–a hefty $400 million increase (see Marathon Increases Cash Dowry for MarkWest Buyout by 63%). Yesterday Marathon announced they have increased it again–they’re now willing to pay $1.28 billion in cash, in addition to unit swaps and other financial high jinks in a deal worth $15 billion (initially was worth $20 billion). That is, Marathon has just added another $205 million to the dowry they’re offering. Does the increase have anything to do with former MarkWest CEO John Fox telling everyone MarkWest is crazy for selling itself for such a low price (see Former MarkWest Energy CEO Urges Vote Against Marathon Buyout)? MarkWest is attempting to win a PR battle against Fox. In their announcement about receiving more cash as part of the deal, MarkWest claims three big unitholders (i.e. shareholders) representing a collective 15% of the outstanding units (i.e. shares) say they will vote in favor of the deal. That’s still a long way from 51%. We wonder if this deal is in trouble…
Read More “Marathon Ups Cash Offer for MarkWest 2nd Time – Deal in Trouble?”