SuperAmerica owner plans IPO

  • Article by: DAVID SHAFFER , Star Tribune
  • Updated: July 16, 2012 - 9:37 PM

Northern Tier Energy, with stores in Minnesota and Wisconsin, expects to raise $325 million from the sale.

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Northern Tier will offer 16.2 million limited partnership units it hopes will bring $19 to $21 each and plans to pay off debt, among other things.

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The new owner of the St. Paul Park oil refinery and SuperAmerica stores in Minnesota and Wisconsin said Monday it expects to raise $325 million in its planned initial public offering of 16.2 million limited partnership units. The company is hoping each unit will fetch $19 to $21.

Northern Tier Energy, based in Ridgefield, Conn., disclosed the offering price in securities filings and said that after underwriting expenses it expected to receive $288 million in proceeds to pay off debt, cover recent losses, make payments related to its 2010 acquisition and reward investment firms behind the deal.

The company, which will trade under the symbol NTI, is a limited partnership that even after the IPO will be controlled by ACON Refining Partners and TPG Refining. The partnership acquired the refinery, convenience stores and a stake in an oil pipeline from Marathon Oil Corp. in December 2010.

In its filings, Northern Tier said its business strategy is to invest in the refining and other operations, and to make acquisitions.

The refinery, like others in the Midwest, has benefited from lower crude prices in the region, thanks to oil booms in North Dakota and Canada.

Norther Tier has 166 company-operated and 67 franchised SuperAmerica convenience stores, where most of its refinery output is sold.

It also owns a 17 percent stake in a 300-mile pipeline that carries crude oil from a hub at Clearbrook, Minn., to the refinery.

How proceeds will be used

The proceeds of the IPO will help pay off $92 million in losses to an affiliate of Goldman, Sachs & Co. on derivative contracts in the last quarter, Monday's filing says. The proceeds also will allow $132 million to be paid to Marathon related to the acquisition, and ending that company's stake in Northern Tier.

The company said its operations are expected to generate $245.9 million in cash for the year ending June 30, 2013, and $61.8 million in the three months ending September 30, 2013.

David Shaffer • 673-7090

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